Macro Economic Trends and Risks
No Recession? Who Cares?

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By Har1en
May 15, 2008

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I saw an article recently that said we were not in a recession, and by the standards that the article espoused, I think I agree. The requirements were somewhat annoyingly arbitrary -- something like two quarters of negative GDP growth and a 20% decline in the major stock indexes.

And to those requirements, I say, SO WHAT? Who cares? If the prices of a bunch of stocks plummet, as an investor, I am not bothered. Stocks go up and down -- their prices, as we all know, are determined more by the vagaries of the emotional place where the buyers and sellers are than by the reality of their earnings or cash flow.

I'm sick of people arguing whether or not we're in a recession. If the GDP is -1% this month or the next, I really don't give a darn.

Here's what I care about -- how about you?

People losing their homes. Homeless folks are a problem, folks who recently lost their homes are a problem. They are depressed, dangerous, and desperate, three things that make for CNN news headlines that I really don't want to read. That matters to me.

Real inflation, as so eloquently explained by far more experienced minds than mine on this very board, is cooking. My money is disappearing like a plate full of cookies in a preschool lunch room. And that money's going somewhere. To corporate profits -- which probably explains why the stock markets are doing all right, despite the tough times. To Arab kings, who own oil that I desire more than water. Real inflation makes my cost of living increases at work seem like grim pay decreases every year.

People are losing our jobs. Worse than losing a home, the loss of a job is devastating today. The numbers of people being laid off of county, corporate, and construction jobs depresses even me, and I'm not particularly empathetic. I doubt that most of these people have adequate savings to safety net themselves through to another job. Their parachutes are not golden -- they're kinda patched and dirty, with lots of holes. If there is one at all.

So, frankly I don't care about recession metrics or government statistical figures. I care that my friends are in danger of losing their jobs, I care that my children are facing public schools with 30 children in a Kindergarten class (no joke). I care that I'm being forced to take my kids to private schools because of this, despite the fact that I pay more than most of my neighbors do into the property tax system that funds the school systems I was counting on.

I care that it costs me $56 to fill 13 gallons of gas, and yet there are literally no other alternatives that I can buy that are better for my pocketbook. (The Tesla Roadster is a little out of my price range, but it's a start!)

I care that when I go the supermarket, I can get cheap produce, so long as I am willing to ingest toxic chemical pesticides and genetically enhanced crops that are bigger and more regularly shaped than they should be and taste like dust.

Those are the things I care about. I frankly am very afraid that the quality of life will continue to erode, and people will start to get used to it (more so than they already have).

So, let's stop worrying whether the government or corporations are in trouble and start worrying about our own jobs, our families, friends and neighbors, because finding solutions is going to be easier if we concentrate on those things and not on the distraction of declining GDP and stock prices.