Why we are in a Depression and why people are in denial

From http://www.statesman.com/opinion/content/editorial/stories/insight/11/30/1130depressdef.html

"Though there's little agreement on how to define an economic depression, many economists point to two indicators — a rise in unemployment and a drop in economic output — that are far larger and last far longer than most Americans have seen in their lifetimes.

In a recession, a much less severe downturn that typically lasts a matter of months, "the unemployment rate increases to perhaps 8 or 9 or even 10 percent," said Michael Brandl, senior lecturer in economics and finance at the University of Texas McCombs School of Business. "An economic depression, on the other hand, is when the economy contracts year after year after year. The unemployment rate in a depression is closer to 20 or 25 percent."

The U.S. jobless rate is now less than 7 percent."

Let's face it, the government can continue printing money, but sooner or later someone, or some international communities, may challenge what is backing up the U.S. dollar, and we're going to be in big trouble.

In 2009, the government will realize that revenues from taxes are going to be way less than they expected. With thousands of business having tremendous losses, there will be very little to tax. We live in a economy of reaction.

So by the time the press starts talking about depression, we will be already to the neck in a really nasty economic situation. Just look at what happened to the "recession", the government admitted we are in a recession way after everyone realized and felt it in their pockets. Well, same thing will happen again, except there are measures that could be taken to prevent this. Check my other postings for my proposed solutions.

Why am I so pessimistic on this downturn of economy? Well, probably because I have witnessed the disastrous management of government, its late and inadequate response, the absolute irresponsible corporate behavior, and the increasing greed of investors.

There is truly a lack of common sense. So unemployment is at 7%. If the auto industry doesn't deliver (and why would they deliver? a money infusion will only sustain the machinery for so long, if sales aren't there, they will eat up the money and have nothing to show for), we will see a huge jump in unemployment. Assuming 2 million jobs lost, that would take unemployment to a 11-12%, with its domino effect in other industries. So a 20% unemployment is not too far unless something is done.

Large corporations that have outsourced everything they possibly could have killed America. Sure, more profit for them (have you noticed how products and services have not come down in price, but their profits skyrocketed?) but same or higher price for us. However, those Americans that lost their jobs will not be buying and spending. It is like a huge twister that is eating up everything on its path. So for those companies that have outsourced AMERICAN JOBs, thank you, you have greatly contributed to the downfall of our economy.

The Depression is knocking at our door.