Harsh words and grim prospects

from Mike “Mish” Shedlock, a “registered investment advisor” with what look to me like Libertarian predilections:

In total, the Treasury has now committed to squander $700 billion and that is before Obama squanders anywhere from $750 billion to $1 trillion trying to prop up a dying consumer-based economy that really can’t be propped up.

More or less the same analysis of the overall plight as Jim Kunstler, though I’m not sure on which points the two would disagree. Kunstler (in his Forecast for 2009) is focused on the upshots of what he summarizes as the Happy Motoring fallacy, which is of course not just about cars:

Happy Motoring is at the core of our unsustainability trap. The car system is going to fail in manifold ways whether we like it or not, and it will fail due to circumstances already underway…

Another voice with some of the same tidings is NYU economist Nouriel Roubini:

But the worst is still ahead of us. In the next few months, the macroeconomic news and earnings/profits reports from around the world will be much worse than expected, putting further downward pressure on prices of risky assets, because equity analysts are still deluding themselves that the economic contraction will be mild and short… The credit crunch will get worse; deleveraging will continue, as hedge funds and other leveraged players are forced to sell assets into illiquid and distressed markets, thus causing more price falls and driving more insolvent financial institutions out of business. A few emerging-market economies will certainly enter a full-blown financial crisis.