The End of Stimulus

The recession is over-that´s what we´ve been told. Job losses continue-albeit at a slowing rate. The car industry got a short term boost late last summer with cash for clunkers, but it´s been tougher going in showrooms since then. The housing sector appears to have bottomed, but house sales are off since the government stopped handing out tax credits to buyers and borrower defaults continue to increase. After Christmas, retailers breathe a sigh of relief-they registered some modest gains during the holidays off last year´s horrendous results, but wonder if consumers have tapped themselves out. Banks stock prices rebound and so do bonuses, but they aren´t lending much and haven´t had to recognize all the bad assets on their books yet even after hundreds of billions of dollars in various federal capital transfusions. The stock market has scored a very healthy rebound, including REIT shares, but you need to wonder seriously whether players haven´t over anticipated the recovery.

So the past few months haven´t been totally reassuring. Then you size up the past 10 years-those numbers about zero net jobs growth. Zero after all the tax cuts, low interest rates, internet breakthroughs-zero!!! And now the President promises to create green jobs through tax credits. That should help fill the jobs gap, which some economists estimate at around 10 million given on-going population and demographics changes. Sure, green jobs will do the trick.