An economy that subsidizes overpaid CEOs at the expense of the middle class is bound to falter. Not only is Unemployment growing, but so is the length of time it takes to find a job. When one in five unemployed are jobless for at least half a year, that's the human version of too many days on the market, and it's hitting the middle class hard.
And that should be a lesson to all of us.
Just like housing, rising unemployment is a symptom, not the disease.
The disease is greed at the upper management levels of our society.
We can't offshore our manufacturing and expect to sustain a healthy economy. We can't keep a nation of consultants employed. We can't overpay CEOs and expect underperforming stocks to be worth holding. We can't continue to subsidize the rich and poor and expect the middle class to carry the burden. We can't let the cub reporters of the financial press or Wall Street, with their short-sighted, fear-mongering, run our economy.
But there are some folks out there who don't see it my way.
Here's what Joel wrote to Realty Times, "The country needs a recession to correct the misallocation that Greenspan and company spawned with their insanely low interest rates for far too long. ... When the Dems ride in in November, we can all kiss it good-bye when they jack tax rates up to try to pay for all this."
A reader named RLB says, "The newspaper did not scare us into a recession; the high price of eating, drinking, and driving did."
And then some guy named Dave says, "I am reveling in this housing recession, and hope it gets much worse before it improves. The housing industry is getting what it deserves, a huge correction and a revamping of lending practices."
Do you see a trend here? No, not that readers don't give their full names. It's that these folks are angry. Their common complaint is that prices need to come down because they went up too much!
What's scary is that some of these guys want to see others get hurt. They're mad about missing the bubble!
Well, sorry Dave, RLB, and Joel. Be careful what you wish for. Prices may come down because you're forcing them to, but they'll never get low enough again to make you happy. For prices to reverse course, we'll have to be in a full-blown recession or depression, where nobody can afford to buy or sell -- and that includes you.
