US' Wall Street sees out bad year

Al Jazeera English

Transcript

the US economy is the biggest in the world as the saying goes when America sneezes the rest of the world catches a cold but in 200 2009 the symptoms pointed to a far more serious condition and was left to US President Barack Obama to come up with the right medicine to steer the economy out of its worst recession since the 1920s here on Wall Street the banks have been widely cast as the bad guys blamed for fueling the financial crisis crying for help under the threat of bankruptcy receiving a government bailout and now back to making healthy profits and handing out multi-billion dollar bonuses to bank Executives but for Main Street and much of the world the recession is not over yet and 2010 may not bring much relief 1 year ago the US economy was in freefall the talk back then was not just of a recession but of a potential depression the First Response of a new president signing into law a nearly $800 billion stimulus package a massive injection of cash that Obama declared would jumpstart the economy create millions of jobs and lay the foundation for Recovery in the months that followed as bank balance sheet stabilized unemployment rates home foreclosures and personal debt continued to climb and while the crisis was kept from becoming a catastrophe there are still precious few signs of recovery as the US enters a new decade we had to come here and face the doors locked on our faces the US unemployment rate hit double digits in October and still lingers around 10 10% many analysts predict jobless numbers will remain high for some time to come I also fully expect unemployment to stay above 8 8 and a half% on average for the entirety of 2010 I I just don't see any large growth areas in the US economy big enough to take up the slack in the labor markets public Anga directed at the banks is likely to continue in 2010 several corporations which were bailed out by the government have repaid the money with interest but Washington has lost its bargaining ship with Wall Street because the banks no longer need help despite plenty of tough talk President Obama and the US Congress have been criticized for not tightening Financial regulations to control the sort of high-risk lending practices which triggered the financial crisis unless I thought it was going to $6 the US dollar is ending the year on an upswing but fell far in 2009 at one point spawning Tor of oil being traded in Euros instead but predictions of the demise of the once Invincible greenb may be premature there only so many games in town as big and as liquid as the dollar and so as much as people are unhappy with many elements of US policy and the US government and the dollar there's only so many places they can run and only so much running they can do at some stage the US economy will bounce back but there are Fier poorer countries whose Banks or governments aren't Rich enough to prop up their economies could experience a double dip recession if they don't manage their recovery properly if you wait too long you increase the debt and that's not good but if you exit too early to take a bigger risk the risk is that you may go back to a new down turn and and in global growth and in this case the consequences may be huge as for the United States economic pains they may plateau in 2010 but any growth is expected to be modest full recovery still a long way off cath Turner Al jazer New York

Financial New Year's Resolutions

ABC News

Transcript

well as we get ready to ring in the new year it's a good bet that many of us have made a resolution or two about money if you're going to try to get your financial house in order next year we've got three solutions to help you get that done and joining me now is cody willard he's the co-host of fox the happy hour on the fox business network good morning good to see you good to see you happy new year thank you so let's let's get to the savings rate we've seen that americans due to this financial crisis have started to save at record levels we haven't seen over the past few years and many decades so what should people be doing with their savings should they be putting it in the savings account or should be they putting in their 401k award you know i think people end up paying way too much attention to the tax implications and their iras and their 401ks and trying to figure out how to maximize their tax benefits and minimize the actual tax payments they make to the government and instead you should really just focus on saving that money making sure that you're getting some return on it or even return of it and not risking it irresponsibly so i'm all for savings savings and let's delve further into the 401k investment because we've seen companies fortune 500 companies over the past year many many more have stopped matching what does that mean for the consumer at home for the consumer at home if you're if you're part of a company that has stopped matching and you probably are most companies have actually cut back on what they even if they are still matching some they're not doing as much as they used to in your 401k when you put money into it so that hurts you i mean that's less money going into your financial savings for the future and that's again it's another reason to not really worry too much about figuring out your 401ks and iras and just making sure that your financial ship at home and your credit cards and real estate and everything else is in order no you mentioned real estate i have to say and i'm sure you can agree uh the number one question i'm asked when i walk the streets is people asking me is now the time that i should buy a home should i buy a house right now we've seen that that tax credit for first time home buyers has been extended through the spring of next year mortgage rates are still relatively low right now interest rates near zero percent what what do you tell people are we going to see a double dipper is now a time to buy you know i i don't even know that we'll call it a double dip because i'm not sure the first step is even over we've had some stabilization temporarily here and yes we have channeled trillions of dollars of new programs and policies from the republicans and democrats in power over the last few years into propping up housing housing is still twice a cost of a real estate a house itself if you're going to buy is still twice today what it was just 10 years ago in most areas of the country i think that's the stock market's still where it was 10 years ago i think there's still way too much risk in real estate if you can afford to put real money into a house and not have to borrow hundreds of thousands or tens of thousands of dollars maybe you want to consider doing that but you got to know you're still risking a lot of money regardless when you put money into real estate it's risky it's risky and something else that's risky is debt and we've seen that americans continue to accrue a lot of debt we have new credit card rules and regulations going into effect in february so what should consumers worried about their debt be doing over the next month with these rules coming into play first thing you need to know that those rules have already been implemented the credit card companies get ahead of the regulations they know that they're coming and if you'll go look at your credit cards you'll know you you should first go and look at your statement right now and you'll see that you're paying if you were paying nine percent on your credit cards nine percent interest just two years ago today it's 25 your rates have gone through the roof it's more important than ever just get out of credit card debt pay it off we shouldn't even be talking about real estate stocks or anything else until you make sure that you have gotten out of your credit card debt it's a 25 guaranteed return to just get out of that 25 interest rate and in this time frame the next few weeks do you think that consumers should start calling their banks once again if they want to negotiate some sort of deal as to getting lower rates possibly sure absolutely i mean there's always it's always a good idea if you think you can get lower rates to try and get it but more importantly figure out ways to pay the credit card off get out of the debt because even if you're paying 15 instead of 25 15 is a heck of a lot of interest to be paying yeah financial crisis are not the number one resolution we seem to have people saying every year is i want to get out of debt this year well hopefully they'll be able to do it in 2010 thanks for joining us cody cody willard happy new year to you