Remember all of those banks that were “too big to fail” and had to be bailed out? Newsweek’s Niall Ferguson is out with a report today pointing out that a year after the collapse of Lehman Brothers signaled the start of the bailout boom, they’re still big, and thanks to the safety net you tossed them, they’re “back to making serious money and paying million-dollar bonuses. Meanwhile, every month, hundreds of thousands of ordinary Americans face foreclosure or unemployment because of a crisis caused by … a few Wall Street giants.”
States that put it all on double zero and let it ride may start wishing they’d listened to Ace Rothstein, and walked out instead of choosing to take the money — and the hammer. The casino industry — once considered recession-proof — is starting to feel the pinch of the current downturn. The New York Times reports that some of the biggest gambling havens, including Nevada, New Jersey and Illinois, have seen massive drops in gambling-related tax revenues. New Jersey’s take was down $62 million, Nevada dropped $122 million, and Illinois spun and lost $166 million in tax revenues.
Good work, consumers of America! You’ve collectively reduced your outstanding debt by $21.5 billion during the month of July. We’re so proud. Except, oops, that’s not so great for the economy.
Ok, so our collective net worth is down several trillion dollars and personally our fortunes have nose-dived, but at least the recession provides a “learning opportunity.” Or at least that’s MSN Money’s point-of-view. They suggest we’ve learned (the hard way unfortunately) the following money lessons from the recent recession :
The number of new unemployment claims filed nationwide was down to only 570,000 last week, but consumer confidence is at a four-month low. Maybe that’s because newsworthy layoffs continue, including Whirlpool announcing that they will cut 1,100 full-time positions in the U.S., located in Evansville, Indiana.
Given how many banks have failed and been taken over by the FDIC this year (84, including three yesterday), it’s not one bit surprising that the FDIC isn’t doing too well, funds-wise. It’s down to $22 billion, the lowest the failed bank fund has been since the savings and loan crisis of the early ’90s, when it needed to borrow money from the Treasury Department to keep going.
People aren’t buying: Large appliances, furniture, and durable household goods
Remember that story about Trina Thompson, the woman who sued her college after she couldn’t get a job? Turns out maybe the institution had it coming.
Do you need cash right now, but are worried that you might lose your job in the next two weeks? Guarantees for customers who lose their jobs have worked for Hyundai, Ford, GM, and Sears, so now the practice has expanded to the payday loan industry.
For the third time in the last five months a new record for foreclosure filings has been reached says foreclosure tracking firm RealtyTrac. July saw an increase of 7% from June of this year and, even more telling, a 35% increase from last year.
The job market is tough. No one seems to know it better than our nation’s fresh-faced recent college graduates. They’ve discovered a harsh truth—despite hounding alumni for donations, colleges aren’t able to find jobs for them. One recent college grad in New York City is fighting back, since she graduated three whole months ago and her alma mater hasn’t found her a job yet.
Here’s a common problem: we have many ex-lovers, who have put ice on our wrists and given us countless pearl necklaces. But these wealthy suitors have left our hearts broken and in this economy, we’re hurting for cash. Thankfully, we discovered Out of Your Life (motto: “It’s time to break up with his jewelry, too”), who will buy our tear-stained jewelry back from us!
The world is currently overjoyed at the news that new home sales have increased by 11% this month, which is apparently much more than expected, but are still 21% below the levels of a year ago.
The deepest “employment slump of any recession in the last eight decades” has consumers convinced they’re about to lose their jobs — and that’s affecting consumer confidence, says Bloomberg.
Are America’s spending habits becoming more… gasp… sensible?? Time magazine has a list of things we’re spending our money on during this recession, and it might surprise you. We’re not buying tinned soup, we’re buying organic veggies! We’re finally getting that root canal we’ve been putting off! We’ve stopped boozing and whoring! And we’re learning to survive without painting our nails.