Obama may have won the election handsomely, but now come formidable challenges. The time for motivational type speeches is at an end. Action, and results, on a wide variety of fronts, will be looked for.
An op-piece in The Independent captures the huge challenges facing the new president and America generally:
"It is a devastating inheritance. The 44th president of the United States takes over an economy that has almost certainly fallen into recession, and coping with that will surely dominate the first part of his term of office. But there is something even bigger stalking the US economy and that is its longer-term dependence on foreign investors being prepared to carry on financing it – in effect, buying up America. To wean the country off such dependence will be even harder than shepherding it through the downturn. Cyclical problems eventually solve themselves; structural ones don't.
Still, this cycle is starting to look much nastier, with prospects suddenly deteriorating in the past few weeks, even days. Until September the US seemed to be coming through the global downturn in somewhat better shape than Europe or the UK. But now the US economy seems to have hit a wall. Consumers are cutting back radically; house prices are still falling; companies are finding it hard to borrow and hence slashing investment; unemployment is rising; and, a practical issue for the new president, the government deficit is ballooning. The Federal Reserve has cut its overnight interest rate to 1 per cent but so far that has had little effect, and obviously at that level has no more ammunition left. If a rate of 1 per cent does not help the economy, why should half a per cent or even zero?
As a result of these darkening economic conditions, Americans have become both angry and frightened: angry because of the excesses and stupidities of Wall Street and frightened because as the malaise has spread beyond the financial community to the real economy they have begun to suffer directly. That fear shows in a catastrophic loss of consumer confidence. In October car sales were down 31 per cent on the previous year, the worst month for the industry since 1991. Allow for population growth and it was arguably the worst month for sales since the 1950s."
Read on here.
An op-piece in The Independent captures the huge challenges facing the new president and America generally:
"It is a devastating inheritance. The 44th president of the United States takes over an economy that has almost certainly fallen into recession, and coping with that will surely dominate the first part of his term of office. But there is something even bigger stalking the US economy and that is its longer-term dependence on foreign investors being prepared to carry on financing it – in effect, buying up America. To wean the country off such dependence will be even harder than shepherding it through the downturn. Cyclical problems eventually solve themselves; structural ones don't.
Still, this cycle is starting to look much nastier, with prospects suddenly deteriorating in the past few weeks, even days. Until September the US seemed to be coming through the global downturn in somewhat better shape than Europe or the UK. But now the US economy seems to have hit a wall. Consumers are cutting back radically; house prices are still falling; companies are finding it hard to borrow and hence slashing investment; unemployment is rising; and, a practical issue for the new president, the government deficit is ballooning. The Federal Reserve has cut its overnight interest rate to 1 per cent but so far that has had little effect, and obviously at that level has no more ammunition left. If a rate of 1 per cent does not help the economy, why should half a per cent or even zero?
As a result of these darkening economic conditions, Americans have become both angry and frightened: angry because of the excesses and stupidities of Wall Street and frightened because as the malaise has spread beyond the financial community to the real economy they have begun to suffer directly. That fear shows in a catastrophic loss of consumer confidence. In October car sales were down 31 per cent on the previous year, the worst month for the industry since 1991. Allow for population growth and it was arguably the worst month for sales since the 1950s."
Read on here.
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