global recession

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  1. lawretta profile image62
    lawrettaposted 15 years ago

    How long do you think this would last.I Can't take it any more. It is invading my job. it is turning the country up, side and down.

    1. profile image0
      nazishnasimposted 15 years agoin reply to this

      The whole frenzy has started from U.S. 'sub-prime mortgage crisis' and I am afraid to say that through U.S., recession will take its last breath. Just a quick review of how the situation over there is : American icons are going bankrupt e.g. GM and/ or Chrysler. Yesterday's success stories are now regarded as burden e.g. SKYPE and StumbleUpon. Foreclosures, Layoffs, Negative financial statements, depleting savings and all the pessimistic scenarios are looming around. Recession may not be going anytime sooner than 2015 if it is allowed to follow its course.

      However, there is still hope. And the hope, ofcourse has been generated by U.S. Chances are that if Obama's two major financial restructuring solutions work, then though gradually but the situation of U.S. will improve and then the 'good waves' will permeate to the rest of the world. The financial restructuring solutions are :

      1. New FASB accounting rule ( if you want to read about it in detail, I have written a hub on it, Please visit : … le-changes).

      2. Obama Government plans to buy the 'toxic assets' in partnership with private investors. Toxic assets are assets that are linked with default mortgages. I have talked about them too in the above link.

      Both these plans will help root out the evil that was responsible for recession.

      If these plans work even then recovery will be slow. However, I wish you all the best for meanwhile. Hope my hub helps your spirits a little (

    2. profile image48
      shadzposted 15 years agoin reply to this

      Hi, dont worry, i have a suggestion if you love it, it can help. ever heard of Robert Kyosaki(Rich Dad Poor Dad Fame).
      He has a solution

    3. forlan profile image61
      forlanposted 15 years agoin reply to this

      even Ben Bernanke and Greenspan could not predict the end of recession. there is no recession. you can try other business to save your life. You know in recession time, people could get million dollars

    4. usmanali81 profile image58
      usmanali81posted 15 years agoin reply to this

      As long as Freemasons rule the world with Humanism, Materialism and Evolution.

  2. Dame Scribe profile image57
    Dame Scribeposted 15 years ago

    I like to think of it like a thunder storm ... it will eventually pass ..for now.. just keep doing what you need to and wait it out (like we have a choice tongue lol) . If we can or need to help others... do what we can. hmm  and friends are a great balm to the spirit. smile keep in mind we are not alone.

  3. bgamall profile image69
    bgamallposted 15 years ago

    I hope it is brief. I believe it will be a long term lost decade for the United States. I personally believe that everything is still overpriced, houses, food, cars.

    I also believe that without the atm machine of house appreciation there will be no new industry or catalyst to jumpstart the economy.

    I have a poll on one of my sites. 61 percent of the people polled said they could not afford to buy their current car now. That pretty much says it all. I believe we are headed for years of serious economic trouble based upon a Basel 2 1998 scam that allowed off balance shadow banking, leading to liar loans, option arms and the rest.

    Once commercial property tanks we will have something close to the great depression. Again, I hope I am wrong.

  4. ledefensetech profile image67
    ledefensetechposted 15 years ago

    Are you kidding?  If anything else this will make it harder to conduct business and will force businesses to spend money on regulatory compliance rather than expanding their business and you know....creating new jobs.

    And where is Mr. Obama getting this money?  It's not sitting around the Treasury, you know.  He'll get it by inflating the money supply, since foreigners won't buy our debt anymore, he won't have a choice, which will lead to price inflation.  This will further cut the spending power of Americans and cause more businesses to go under.  Not a prescription for recovery.

    If you want a plan for recovery, look at what Japan has done for the last decade-and-a-half (!!!) and do the exact opposite.

    1. profile image0
      nazishnasimposted 15 years agoin reply to this

      I really don't like the tone but still I would write a reply to your post.
        So where were we ... yes, the FASB rule. Solutions to mega problems like 'Recession' target a 'mega issue'. Suggesting to create more jobs is as naive as saying that 'close your eyes and recession will go away'. You have to look at the root cause of the problem and that is - the subprime mortgage crisis which translates into frailty of the banking system. Increasing worth of the banks (which are now literally in tatters), in the eyes of investors, would be one of the most effective ways of eradicating the whirlpool from its root - and that is precisely what the new FASB rule targets.

      Your second comment has a very simple answer - 'a healthy banking system = robust mortgage backed securites/assets = healthy economy' AND 'Toxic mortgage backed securities/assets = an unhealthy banking system = RECESSION'.

      1. ledefensetech profile image67
        ledefensetechposted 15 years agoin reply to this

        Sorry about the tone, I just have a hard time understanding your views.  I'm not sure what you mean by a mega issue.  The root cause of the depression, because let's face it we're in a depression, was the loose monetary policy of the Fed.  Credit was so loose that anyone could get a house regardless of their ability to pay the mortgage back.  You cannot build a sustainable economy based on that.

        The government is to blame not only for the monetary policy, but for the use of the Community Reinvestment Act of 1977 in forcing bankers to lend to minorities who couldn't pay back those loans because of a fantasy called "redlining".  In order to get these bad loans off their books, banks chopped them up and bundled them up sold them on secondary credit markets as investments.

        But the banks started to buy their own BS.  They knew these CDO's were bad investments but like everyone else during the boom, they came to believe that houses only go up in value.  They should have known better.  So banks began buying up these CDO's as they were giving off good cash flow at the time. 

        Then the Fed stopped the money train by raising interest rates.  This caused the ARM's to reset to a higher rate and people began to fall behind in their payments.  Lo and behold we had another problem.  Because so much money flowed into the housing markets, housing starts boomed.  While the money and credit were flowing, this wasn't a bad thing.  But now there's a glut of houses on the market and people stopped buying.  In fact many builders found themselves upside down by building houses for more than they could sell them for.

        Banks began losing money no only because of defaults, but also because those CDO's that they used to inflate their earnings projections suddenly didn't look so hot.  Basically they got hit by a twofer.  Less money coming in and "assets" that were really liabilities. 

        Now people who know what accounting and economics really are, saw this coming a mile away.  Banks and regular people didn't want to see what was on the horizon, they wanted the party to continue forever.  If you want to fix the problem, let the banks that were stupid and greedy fail.  That will teach the others to be more careful about how they conduct business. 

        Besides, there are plenty of banks out there that aren't in trouble and would be able to buy the assets of the failed banks.  In that way productive assets, not junk or phony "investments", would find their way into savvy hands who would then use those assets to rebuild the economy on a more secure foundation. 

        The new FASB rules might work for a time, but since you've bailed out the morons who got us into this mess in the first place, you're encouraging people to throw good money after bad.  I give it less than a year before bank stocks tank again.  There's the alt-A loans that still need to be reset and there's problems on the horizon with commercial mortgage loans as well.  So about the time your investors feel safe with these new rules and start investing again, the market will tank again and investors will get  burned again.

        Again, I'm confused, how is this a solution?  It sounds like a cause effect analysis, not an answer to how Mr. Obama is getting the money and how he intends to pay for all of this without creating more inflation, which will damage the economy and make things hard on everyone, especially the poor.

        1. jayb23 profile image70
          jayb23posted 15 years agoin reply to this

          New FASB accounting rule: Will it work

          My views
          I believe FASB under the pressure of congress has eased down MTM rules. I can look at it from 2 sides. If I were the head of Citibank or Goldman or JPmorgan, I will be very happy, because now I can show impressive numbers as I wont be writing them down at their current market price which is abysmal at this point in time. Infact market for these toxic assets has virtually dried up. Companies can account for mortgage-backed securities and other assets based on their internal estimates of cash flow and other factors. But on what basis will these institutions determine the cash flows remains to be seen. Are these assets good enough to be traded in near future ? I do agree fair value rules have reduced the profitability of banks, but we want banks who are transparent.

          Now if I look from other side say as a investor. Investors needs transparency. How many investors know accounting rules. This is just a number tweaking, yes which will boost up the profit, but does it addresses the real problem? The problem of lack of underwriting standard during credit boom, lack of regulation.

          I dont think so by tweaking rules a wee bit can solve the problem. Also the rules were made under pressure from banks who had to declare the quarterly results and wanted to show impressive numbers. But the real issue still has to be addressed. This is akin to applying band aid to a person who has met with a serious accident.

          Obama Government plans to buy the 'toxic assets' in partnership with private investors. Good enough?

          My Views
          I have my doubts. This plan might work, in the sense of facilitating the removal of some toxic assets from the balance sheets of banks which will improve the numbers. But it is unlikely to work, in the sense of restoring the banking system to health. I believe the confidence of American people in their banking system is at a all time low.
          This plan may prove to be part of the solution, but a relatively small part. I still believe corporations have to act more responsibly and there has to be bit more regulation in place. This plan will fail to take off if american economy goes further in recession. I also believe that this plan is just worth $500 billion which is on small scale. So if this plan has to work, its scalability has to increase.
          Suggestions Welcomed
          P.S. I have written a Hub on the other side of SuB Prime loans. Any body who is interested can check it out.

  5. Curious Traveller profile image69
    Curious Travellerposted 15 years ago

    It will pass eventually but some people don't realise the extent to which it affects the small businesses. The bigger ones such as the banks can receive Government bail-outs and the likes but the individual business owner has no chance of same.

    I will share with you what is an absolutely true story:

    In December 2008, I was only just holding my head above water. I was paranoid about what was going to happen and made the mistake of telling no-one about how severe my situation was. This ultimately cost me my girlfriend, but that is a different story.

    The first Wednesday in December, I received a telephone call from a colleague/acquaintance in business to tell me that he had filed for bankruptcy and that his wife was leaving him, was taking the children and that his home had been re-posessed by the bank. He seemed positive enough in the sense that he was going to move on and given that he resided a long way away from me, it was not practical that we could arrange to meet up there and then.

    I received a telephone call the following afternoon to tell me that "John" had committed suicide the previous evening...

    Governments have to address the problems of the small business owner every bit as much as the conglomerates if we are to escape this recession.

    I very much hope that will be the case..

  6. ledefensetech profile image67
    ledefensetechposted 15 years ago

    I wouldn't hold my breath.  It would be nice, but small businesses are just that, small.  I'm sorry about your friend.  It's like all those other people snapping and offing their families and/or other people.  I wrote a bit about it on my blog: … violence/.  So much has happened since I wrote it I could probably make it into a serial. 

    If there's one thing we can do it's to try to get people to have hope.  As long as we're alive we can still choose to change things.  The idiot politicians are out of our hands, the (maybe) asteroid that's going to hit us is out of our hands, but we can still choose to do something.  We can make a change, start a business, get another job.  For every door that closes another opens. 

    That's why I started a self defense business.  With the way things are going, it's going to be rough for a time.  But we can survive as long as we don't panic.  Heck, I don't even watch TV anymore, news channels were doing bad things to my blood pressure.  Don't give up.  Ever.

    1. earnestshub profile image81
      earnestshubposted 15 years agoin reply to this

      Well said! The economy will be trashed by the borrowing, but individuals will find a way to survive.

  7. Dame Scribe profile image57
    Dame Scribeposted 15 years ago

    I think all those corporate bigwigs should give up a portion of their pay to offset the debt lol like that would ever happen, lol

  8. profile image0
    Esther Selmanposted 15 years ago

    I'm hearing a lot of people refer to "positive signs" without giving specific detail. Today it was Vivian Schiller, head of National Public Radio. I'm not sure what they mean. The latest "positive" stat I heard was that housing prices fell by double digits in February. The good news? The decline didn't set a record.

  9. ledefensetech profile image67
    ledefensetechposted 15 years ago

    It's like I said before, those rules are going to hose investors.  Do you really thin anyone is going to invest in those toxic assets ever again?  This won't keep them form doing that sort of nonsense in the future.  This is also known as lying.

    What regulations would you suggest?  Remember it was the CRA that got us into this mess in the first place.  Just saying regulate without saying what will be regulated or how it will affect business isn't much of a solution at all.  If we make it harder for people to do business in this country, businesses will fail.

  10. profile image0
    pgrundyposted 15 years ago

    I think we're in for a five year downturn, maybe longer. Hope I'm wrong.

    Once the economy does start to revive, we will not climb back to where we were before. We'll be a nation among many instead of #1. The new #1 will likely be India.

    The entire history of banks in the U.S. is boom, bust, boom, bust, boom, bust--except for the period between the about 1942 and 1999. This bust is the biggest ever. We won't be the same after.

  11. DennisBarker profile image60
    DennisBarkerposted 15 years ago

    I've lived through the seventies, which was mostly a period of unemployment and poverty for the area of the UK in which we were living at the time, and the early eighties, which showed some promise but never actually reached me. Then a brief period in the nineties (after a property slump) where I hade enough to live comfortably for a while, followed by a period where I had barely enough income to feed myself and my flat was reposessed.
    At the moment I'm comfortable again, and intend to remain comfortable for the near future, however decisions about credit taken in another country might effect the local economy.
    At this point I am not living in a recession because I have developed a three way strategy for income. I have my regular job which covers the basics, some income from my healing work and some income from the internet which if required could cover food ,shelter and clothing.

    I've learned through experience not to rely on one source for anything, always have at least one back up source which can be ramped up if required.

    As an answer to your question, this recession will be deep and long, possibly not turning until the end of 2009 but the recovery takes another couple of years after that to start showing through so the psychological end of the recession is closer to 2012.

  12. ledefensetech profile image67
    ledefensetechposted 15 years ago

    I agree, it'll be a lost decade, perhaps even a lost generation.  The boom didn't last from 1942-1999, the boom lasted from 1982-1999 then we had a blip from 2001-2008.  Don't forget that we had something of a lost decade in the 1970's. 

    As for being number 1.  What does that mean exactly?  Shouldn't us getting our house in order be our priority.  After that everything else will take care of itself.  As long as we allow people to come here and make a life for themselves, why should anything else matter?

    To get an idea of the history of banks in the US, try Murray Rothbard's History of Money and Banking in the US:; it covers a time span from the colonial era to the end of WW II.

    1. profile image0
      pgrundyposted 15 years agoin reply to this

      Thanks for the link. I'll check it out.

      I just meant though that compared to what came before, the period between WWII and 1999 was relatively stable, but you're right, technically the latest boom was much shorter.

      I'm with you, I don't care if we're #1 either (whatever that means)--Less drama, more stability, that would suit me fine. And it would be nice if ordinary people had a shot at a decent life somewhere in the mix. smile

  13. ledefensetech profile image67
    ledefensetechposted 15 years ago

    Let's say that the economic world was relatively stable from the end of WW II to the collapse of the Bretton Woods agreement in 1972.  That incidentally is what launched our "lost decade".  The economic history of that time is interesting and as few reporters have bothered to learn about it, much of the public knows nothing about it.

    Since 1972, the world has been a nightmare of inflation followed by currencies scrambling for some sort of commodity backing, followed by floodgates of money being poured on us followed by booms, busts and more inflation.  It's going to be a bumpy ride.

    You cannot have a stable economy without a stable currency.

    1. profile image0
      pgrundyposted 15 years agoin reply to this

      That's true, but it's complex. Lots of people are all about 'bring back the gold standard', ignoring the fact that when we had the gold standard we had financial instability too.

      I recently read Kevin Phillip's book 'Bad Money' in which he pins our current mess on three factors: debt, securitization, and oil. Phillips argues that for the past 30 years we've basically had an oil-backed currency, but no one talks about it. Now that era is ending, so we have this insane finance built on finance castles-in-the air business.

      I would like to see less artificial wealth and more real value, but what will this involve? The manufacturing base here has been more than halved over the last decade alone. 'Green' jobs will not be enough to fill the gap. We can't go back to an agrarian economy without pain and loss. So I think that yes, we will go through some long hard times.

  14. jayb23 profile image70
    jayb23posted 15 years ago

    I believe some Americans still haven't come to grips of this situation. I still think you believe the only way to do business is sans regulation. You believe that once regulations come, business will become harder to do. That can never be the case. Look at some of your financial institutions who were highly leveraged some in excess of 30. What made matters worse was the quality of assets were below par. Do you think so much debt is necessary. Shouldn't there be some cap on that? The tax payers money is being wasted to rescue the bigwigs. AIG is using bailout money to give bonuses. Dont you think some rules should have been necessary when bailout money was being given. Citi and BOA have failed the stress tests which means they require more capital. A bit of discipline is not a bad idea after all. Iam not in favour of complete regulation but some regulation is must . Put Caps on amount of loan a company can take. Being prudent while investing is a smart thing to do rather than trying to appear brave when actually you are making a fool out of yourself.

  15. apeksha profile image66
    apekshaposted 15 years ago

    worst condition...
    so many people have lost their jobs n so many are in search of...
    it affected all the world...
    expecting that it will soon come to an end...

  16. ledefensetech profile image67
    ledefensetechposted 15 years ago

    One of the big problems with the gold standard was bimetalism.  What would happen is that governments would overvalue one currency, which would then be taken out of circulation as money, melted down and sold for a profit and the other metal would be undervalued and be used as currency.  Prices for gold and silver coins were fixed, rather than allowed to float with the supply and demand.  Money is a commodity like any other.  If you increase the supply, the value diminishes, if the supply decreases, price goes up.  If governments intervene ant set prices, shortages or gluts occur.  The problem is with outside interference with the market.

    1. profile image0
      pgrundyposted 15 years agoin reply to this

      That's where we disagree, but it doesn't matter. It's not like the Fed is going to be ringing up either one of us anytime soon for advice! lol

      1. ledefensetech profile image67
        ledefensetechposted 15 years agoin reply to this

        I've been waiting with baited breath by my phone for that particular call.  I'm starting to lose hope. big_smile big_smile big_smile

        The CRA was a regulation and it was responsible for much of the subprime mess.  If you put caps on the amount of money a company can take out in loans, you've just hamstrung your economy.  Businesses need money and credit in order to expand.  Do you know enough about every business on the planet to decide how much a company needs to borrow?  No?  Neither do I.  Leave it up to the businesses.  If they screw up, they go bankrupt like they should.  If you don't understand a business, don't invest in it.  If you want to invest in a company, learn more about it. If you don't do any of the above, expect to lose your money.  In the end, regulations give people a false sense of security and make them intellectually lazy.

        1. jayb23 profile image70
          jayb23posted 15 years agoin reply to this

          There seems to be a patent unwillingness  among many Americans to admit to and confront the problems facing the American economy. Recognition of the problem is a prerequisite to working towards a solution. Business do require money to expand, but by saying that taking credit from the market as much as you want and increasing the debt levels to dangerous levels is akin to saying I will drive at 100 miles per hour and I wont respect the traffic signals and I don't care for people who are crossing the roads. I will die and will kill others too because I enjoy driving at high speeds. Regulations make people intellectually lazy is an absurd thought. Generate money from your business rather taking so much debt. If you take too much money and not generating enough money from your business then you have no right to conduct business. Corporations have a responsibility towards shareholders and society. One has to act in a responsible manner if this world has to be saved from another crises. So many companies were directly or indirectly affiliated to Lehman Bros. Its fall affected so many other companies across the world. Time has come to open your eyes and acknowledge the problem at hand and deal with it rather than just blaming the regulators for the mishap.

  17. Research Analyst profile image72
    Research Analystposted 15 years ago

    It could last up to 5 to 7 years, I think this is going to be a long running economic crisis that will get worse before it gets better. many are returning to school to get advanced degrees, while others are looking at ways to start freelancing, or working part-time, on-call or as a temp.

    Some trends I have noticed is that people are becoming more self contained by growing a vegetable garden for food, renting out rooms in their house and getting bicycles to save on transportation. It will be interesting to see how people learn how to conserve, save and stop spending on things that are not immediate necessities.

  18. ledefensetech profile image67
    ledefensetechposted 15 years ago

    Where did a ever say I felt sorry for people who screwed up?  As a businessman, I have to be careful about how much debt I have.  You can use debt to expand business and ensure profit, but it can also swallow you whole.  If I'm dumb enough to get in over my head and not have an exit plan, I have only myself to blame. 

    If I'm head of a corporation, then I have a responsibility to my stockholders as well.  But stockholders have a responsibility to themselves to research a company and figure out if what that company is doing will work or not.  It takes effort and work to do that, but unless you do, all you're really playing is a giant roulette wheel, because you don't know what you're doing.

    True, but if you expect a bailout, how careful are you going to be about taking money out of the business? 

    Wrong, they only have a responsibility to their shareholders.

    That's the fault of the people who trusted Lehman Bros.  Anyone with half a brain knew Lehman, AIG and others were and still are overexposed to bad debt.  Regulators and regulations aren't going to change that.  When the next reset of Alt-A loans happens in a couple of years, you're going to see that.  All these regulations will do is get people feeling good about these stocks just in time for them to invest before the next crash.  We'll just have to wait and see who is right.

    1. Mark Knowles profile image57
      Mark Knowlesposted 15 years agoin reply to this

      On this - we can agree. But if you think the Alt-A loans are bad - wait until the commercial property defaults get going. Just as leveraged.

      Walk in the park so far............

    2. jayb23 profile image70
      jayb23posted 15 years agoin reply to this

      May God Bless America and its economy!!!!!

      1. profile image0
        nazishnasimposted 15 years agoin reply to this

        I told you Jay!!!! big_smile

    3. jayb23 profile image70
      jayb23posted 15 years agoin reply to this

      This is technically a correct statement. No doubt about that. But the problem starts when you think like a frog who is in a well and for whom the lakes, rivers and oceans dont exist. When you say Corporations only have a responsibility to their shareholders, it means you are thinking in isolation and missing the big picture altogether. Corporations are also part of the society and if society suffers, corporations will also suffer. You dont have to look too far in history, this Subprime crises is a prime example of it. Society and world as a whole has suffered and Corporations like Lehman which could withstand Great depression, could not survive this crises. There is more to life than topline and bottomline and a company which thinks about society as a whole will be the one which will survive any crises and infact will act responsibly toward the society and at the same time will make profit. Finally, a company consists of we human beings and there is no harm if we can think of the BIG picture before taking decision.

  19. Misha profile image64
    Mishaposted 15 years ago

    LOL I think you guys agree on much more - except for religions lol

  20. profile image0
    pgrundyposted 15 years ago

    "There seems to be a patent unwillingness  among many Americans to admit to and confront the problems facing the American economy. Recognition of the problem is a prerequisite to working towards a solution. Business do require money to expand, but by saying that taking credit from the market as much as you want and increasing the debt levels to dangerous levels is akin to saying I will drive at 100 miles per hour and I wont respect the traffic signals and I don't care for people who are crossing the roads. I will die and will kill others too because I enjoy driving at high speeds. Regulations make people intellectually lazy is an absurd thought."

    This is what I also think. Americans have had differing opinions on business and finance since the country began, but regulation of the financial industry prevented the kind of insane leverage that resulted in Lehman Bros going belly up for 70 some years.

    I think the Gramm Leach Bliley Act was the last mad whoop and holler of the free-markets-regulate themselves crowd, and it did us in.

    For some Americans finance IS religion. Believing in the innate wisdom and goodness of totally free markets is like believing in God, or the Tooth Fairy, or Bigfoot. No evidence for it at all, but if you're a true believer, you can't be reasoned with. You'll die a true believer.

  21. Misha profile image64
    Mishaposted 15 years ago

    LOL And some Americans keep believing that their government acts in the best interest of people. No evidence for it at all, in fact plenty of evidence to the contrary, but if you're a true believer, you can't be reasoned with. You'll die a true believer. lol

    1. profile image0
      pgrundyposted 15 years agoin reply to this

      Well, one thing is for sure: We'll both die!

      I hope not soon though. smile

  22. profile image50
    mrgeorgesmithposted 15 years ago

    In the UK the government predicts the first growth figures to emerge in the final quarter of this year. Whilst this may be slightly optimistic the fiscal stimulus provided by governments around the world should at least level off the decline by the end of the year and help growth throughout 2010.


  23. ledefensetech profile image67
    ledefensetechposted 15 years ago

    What I'm suggesting is that companies that got involved in the subprime mess were not looking out for their shareholders.  Anyone with two brain cells to rub together knows that you cannot lend money to people who can't afford it and expect them to pay it back.  What those CEO's did was gamble.  They thought they knew enough to get out before the whole thing collapsed.  They didn't.

    CEO's watching out for their shareholders is much more than looking at the bottom line.  It's also about doing business in such a way that people don't find fault with what you do and since they don't have any animosity towards you, they continue to buy your products.

    The thing you don't understand about free markets is that you cannot as a businessperson force anyone to buy your product.  You have to convince people.  If you can't satisfy your customer, someone else will.  If too many people do a better job than you, you go out of business.  That's as it should be.

    Nobody is too big to go out of business.  The fact that we let some of these companies get so big is a problem we'll have to pay for.  Bailouts will only prolong the agony by taking money from productive ventures and giving it to failures. 

    While I'd like to believe that, I'm too much a student of history to believe that.  During the 30's governments round the world did much the same thing.  Hoover himself increased the federal budges by 40% to fight off the Depression.  It had no effect.  FDR did the same thing for a decade and it didn't work.  Even his Treasury Secretary, Morgenthau, lamented about it in 1937. 

    A lesser known controversy is the supposed depression that would occur in the US after the War and government spending dropped.  The papers stoked so much fear over this that Montgomery Ward stopped opening new stores and began cutting back on his inventory.  In fact, they were wrong and less government taxes and spending caused the post-War economy to boom in the US.


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