Dow Drops 300 Points on Weak Economic News
Weak manufacturing and anemic job creation caused the Dow to take a 300 point dive today. As I have written many times here, until the major corporations invest the nearly $3 trillion they have in capital reserves and the banks cut loose on the more than $2 trillion they are sitting on, the U.S. economy will continue to slip and slide.
I heard a housing report this morning and it stated that housing will not return to “normal’ for 5 ~ 8 years.
Job creation is around 200,000 a month for the last three months. We need to be above 250,000 a month over the next 3 years ( easy math ) to get back to 2007 employment levels.
With the Republicans threatening to shut the government down (more blackmail tactics), unless Medicare is “reformed” and trillions cut from the deficit and debt ( two different things), job creation will take a back seat to nasty politics for the foreseeable future.
As I posted recently: There are answers to putting our nation back on the road to recovery. One glaring answer is to let the $2 trillion dollar Bush tax cuts for the wealthy expire next year. This is supported by a recent report from the Center on Budget and Public Policy. The CBPP reports: Simply letting the Bush tax cuts expire on schedule… would stabilize the debt-to-GDP ratio for the next decade.
Read related Atlantic Monthly article: Does Washington DC Care About the Economy Anymore?