I think it has already clearly been shown that the economy is in for years of stagnation and recession. Unemployment is around 10% in most states, and there are millions of people who have exhausted their maximum 99 weeks of unemployment eligibility. The bailout package worked as a temporary bolus to the economy, but unfortunately failed to work as long term job creation.
The economy is based a great deal on government spending. The U.S. Government is the single largest employer in the nation. They spend more on defense than any other nation on Earth. Until they spend more efficiently and regulate their spending across multiple industries, the balance of cash flow through the private sector will never equalize, and there will continue to be problems with the economy.
I feel that this economy is in such grave shape that even an extra bailout given to citizens will not do a world of good on any level. We are in such grave shape, that the only things that will save us are big bonuses and spending. Sorry, the bailout won't have much effect here. Give back some jobs, and that may help.
In order for the economy to recover, everyone has to act together, in unison. This means that all branches of the government, big corporations, small businesses and individuals all have to agree to banish the fear of this recession, and start spending and lending. The economy will remain in recession until people stop fearing the repercussions of spending.
The U.S. economy is in for years of recession and stagnation, even with the bailout package, because the jobs "saved or created" by the stimulus were smoke and mirrors. The stimulus did not work as planned, and the U.S. economy continues to spiral down. Housing prices are continuing to drop, causing speculators to default on underwater mortgages. Foreclosed homes are depressing the price of all homes. High gas prices are increasing the cost of all consumer goods. The threat of Obama Care, new taxes, and new regulations is discouraging businesses from hiring. About 25% of Americans are either unemployed or under-employed.
The fundamental problem with the U.S. economy is an overly zealous commitment to a free-market economy. Attempts to cut the costs that are gouging the American public continue to gouge the public in new and different ways. Hence, our form of economy lets the prices of gasoline and health care spiral out of control. The profits for the oil, health care, pharmaceutical, and insurance industries are ridiculous. Meanwhile, government spending involves too much military action, and too little genuine domestic aid. We need a limited socialism, including caps on profits in several sectors, limited executive salaries, and reductions in the costs, not the provisions, of health care. We need to change our transportation industry. And, we need to be far more modest in what we all believe is an appropriate way to live.
The recession has been going on since 2004, though nobody would admit it until recently. The economy has suffered such a blow that it will never be the same again no matter how many bailouts are granted. The bailout money is always misappropriated so it never really does anybody any good. It does however create more crippling debt for our country.
The major problem with the economy (that, frankly, the bailout didn't help) is the lack of hiring by the private sector. Yet these companies, some of them recipients of bailout money, are now hoarding over one trillion dollars in cash. They have money, but the private sector abhors uncertainty. The threat of repealing the Bush tax cuts kept businesses from spending that money, as big business also abhors paying their fair share of taxes. Therefore, the compromise created at least two years of certainty in which the private sector will try to create more wealth. In order to do so, employees will need to be hired, therefore stimulating the economy. Of course, this is going to come at the expense of the next generation. But in America, you have to keep the rich happy I guess.
Currently, people that are unemployed cannot be hired until the rest of the country boost the economy enough to warrant companies to hire new employees, It is a vicious merry go round that will be hard to get to stop.
Sadly, It will take years for the issues to right themselves enough to make our economy strong again.
As more money is pumped into the economy, the actual purchasing power of the "extra" cash will encounter prices that have already been driven skyward--inflation--or it will be a case of too little, too late and the economy will suffer stagnation when people discover that additional money can't keep up with higher prices.
China was one of the 6 countries least hit by the current recession. China is known as a "saving" country. The people save a great deal of their income. America is known as a "consuming" country. We shop compulsively and buy prolifically. We save practically nothing. If we put all our faith in our ability to pull ourselves out of this recession through our consumerism, maxing out credit cards again, over-indulging, buying whatever is touted on television as the latest "must-have" item, then then we will find ourselves sinking back into recession after recession. In other words, if we continue to do what we have always done, we will continue to get what we have always gotten. We are only one generation away from the generation that believed that you didn't need to buy something new until the "old one" gave out. They paid cash, because they did not want to be indebted to anyone. We do not need to take saving to the extreme. But we do not need to take consumerism to the extreme. As a nation, and as individuals, perhaps it is time for us to "grow up" and adopt a more balanced approach to how we spend.
Even if another bailout was put through, I don't think it would help our nation's economy as a whole. The first bailout has only succeeded in staying off even worse recession, and it has done little to help us recover. It will take a few years (at least) to fully recover.
The US economy was dealt a terrible blow with the housing market crash and the overall devastation resulting from it. This is something that will take years to get out of, but it will be accomplished. The recession might last, but only in the sense that there is no quick way to bounce back from the depths. Things will not stagnate, the recession might continue for a while but it will improve gradually, and the US economy will get better.