FROM David Shulman
A Recession on the Horizon? In the past few days, the word "recession" has worked its way out of the business sections onto the front pages of newspapers and the covers of magazines. "Everyone knows…another recession is inevitable sooner or later. Some indicators now suggest that it might be sooner." The New York Times, the Wall Street Journal and the Financial Times are headlining stories about a coming recession. Back in August, the Economist asked, does America need one? The sub-prime mortgage crisis and the end of easy credit are putting a damper on consumer spending, which has been driving the economy. Does that mean recession's inevitable? Could it be stopped or at least postponed? Would there be benefits to getting it over with sooner rather than later?
Economy Sheds Jobs in First Downturn in Four Years Economists expected some slowdown in the economy because of the turmoil in the mortgage and housing markets, but the news this morning was far worse than expected. The Labor Department said that job growth had not just slowed, but reversed course in August for the first time in four years. The country lost 4,000 jobs. The stock market swooned. Is a recession looming? David Shulman is a senior economist with the UCLA Anderson Forecast.
Home Loans and Easy Money, until Times Get Hard No less an authority than Alan Greenspan, former Chair of the Federal Reserve , called sub-prime mortgages a tool for democratizing credit. Sub-prime mortgages with no down payments are advertised as the road to home ownership for families who can't afford regular loans. They often gamble that they'll be able to re-finance after the house goes up in value, but before new interest rates and higher payments kick in. Now, with the housing market is cooling off, the formula is failing to work for more and more people. Foreclosures are up and they're likely to increase even more. Did stock analysts paint an overly rosy picture of the sub-prime mortgage market to generate investment? Do risky loans to millions of vulnerable borrowers threaten the whole economy? We hear from economists, consumer advocates, a state official who's going after shady lending practices, and John and Delia, two homeowners caught in the sub-prime squeeze.
Mixed Messages from US diplomats on the new hard line on Syria Since President Trump's surprise retaliation against Syria's use of chemical weapons, Bashar al-Assad has used the same airport to launch conventional attacks on his own people. It's not clear what the US, its allies — or Vladimir Putin's Russia -- plan to do now.
Trump's ethical conflicts pile up as transparency diminishes President Trump's refusal to reveal his income tax returns is just one example of a lack of transparency that could be hiding conflicts of interest. Other conflicts are already obvious from his appointments. And he's being sued for using his job to increase his profits.