Boehner Makes Ugly Threats on Debt Limit Increases

Uncork the champagne bottle and strike up the bank; it’s time to declare that the recession has bottomed out, and that confidence is beginning to return to the American economy.  This doesn’t mean that the pain is over, of course; it only means that the pain may not get any worse.  Investors cautiously stepped back into the stock market this week, after last week’s depressing stampede to sell their stocks at bargain basement prices.  The Dow Jones Industrial Average edged up by almost 800 points for the week, marking a 10% gain.  The cautious optimism among investors was largely due to good news from the financial services sector.  Citigroup, one of the country’s largest commercial bank, announced they would not be requesting additional bail-out money in March, and Bank of America announced they had returned to profitability in January and February.  Both of these gigantic financial services companies were, at one point, technically insolvent, and reliant on federal aid to continue operations.  To be sure, other large banks throughout the country are in serious financial condition, and will likely need large influxes of bail-out money to stay alive.  The glimmers of hope coming from Citigroup and Bank of America were enough, however, to convince some investors that the worst of the banking crisis is behind us.

In addition to some positive signs from the banking sector, investors were also encouraged by better than expected Trade Data released by the government.  During the first two months of 2009, the U.S. trade gap narrowed considerably by 10% from December of 2008.  This marked the lowest Balance of Trade deficit recorded since October of 2002.  The narrowing of this key indicator is seen by some economists as essential to the recovery of the U.S. economy. 

A final piece of good news came from General Motors, who announced they may not need the latest installment of federal bail-out money in March.  Although one no believes that GM has put their financial problems behind them, some industry analysts think that the auto maker is making significant progress in reducing their crushing level of expenses.  In addition, GM is rumored to be close to making an agreement with the labor unions and with bondholders that will help to restore profitability when auto sales recover from the current dismal levels.

Make no mistake about it, the patient (i.e. the American economy) is still in critical condition.  Unemployment is high, confidence is low, and many people are still in shock over the magnitude of losses in their 401K’s.  In the midst of the “Winter of our Discontent” President Obama has been steadfast in his belief that better days are ahead for America.  In spite of the recession, he has plowed forward with his programs to reform health care, to improve America’s schools, to rebuild America’s infra-structure, to develop renewal energy sources, and many other worthy initiatives.  Largely as a result of his courageous agenda and his confident leadership, America will soon emerge from the dark days of recession with a new resolve to put the past behind us and to march ahead to better days of prosperity and justice.