If you think the economy is bad now! ( Archived) (29)

If you think the economy is bad now, by the time the 2012 elections take place, you will have seen:
The labor department stating headline unemployment of more
than 18%.
Major government layoffs at all levels.
Dow 3200
Illegal immigrants returning to their home countries.
Soup lines
50% deflation from the 2007 peak.
Annual car sales of 5M units.
Mortgage delinquencies rates of 30%.
20% interest rates.
Will Obama have caused it? No, the problems have been building for 6 decades and even if health care, cap and trade, etc., etc. pass congress and are signed into law, there will not be sufficient capital available to fund them regardless of what the tax rates are raised to. There will be no new public works plans funded, schools will reduce hours and those eligeable for Social Security will continue to work because they will not have sufficient incomes to retire on.
Give your thoughts.

The unemployment rate today is 17.6% if you count those who have run out of unemployment benifits, high school and college graduates seeking employment but are not counted in the workforce because they have not been previously employed full time and those laid off from less than full time jobs. Source, Dept. of Labor statistics.
National debt, local and state debts and contingent liabilities currently amount to $105T, or $350,000 per capita. Annual per capita interest at 4% amounts to $14,000 per capita if no further liabilities are incurred. Current GDP is about 14T, so the total of all debts is 7.5x GDP. Source, 2009 World Almanac and Book of Facts and national debt meter.

109 banks have closed so far this year(Bank implode-o-meter, FDIC), the FDIC is short of capital(FDIC quarterly statement), state governments have already disclosed necessary layoffs, there are soup kitchens and food pantrys across the country that are currently screaming for donations as useage is increasing nearly every month, car sales dropped from 17.6 million annual units in 2007 to 10.8 million units today and the 5M number is assuming unemployment rises as expected.
Deflation follows inflation when employment and demand decline(Econ 101), Dow 3200 is based on nothing more than P/E ratios holding steady on projected foreward earnings(Daily Reckoning). After reaching a low in Oct. 2009, mortgage resets in 2010, 2011 and 2012 will exceed the numbers at the peak of the subprime crisis(Market Oracle, Mortgage lender inmplode-o-meter).
The reason why loans are not being made now is because the interest rates and returns are low and bank reserve requirements have been raised. If you look around, many who are making consumer loans are charging 9.9% or more, so it is not a streach to speculate that they will rise to the rates they were in the 1980's, when we were also in a recession.