Category: Economic Crisis and Recession

What a President Trump might mean for your personal finances

What a President Trump might mean for your personal finances

Donald Trump became the presumptive Republican presidential nominee this week, casting a more serious light on the policy proposals he has put forth during the GOP contest. Here’s a quick look at how some of Trump’s economic ideas could broadly affect your finances should he prevail with both voters and Congress (keeping in mind that his plans are likely to evolve as he prepares further policy speeches and chooses his running mate).

Your purchasing power

The hefty tariffs on imports Trump has proposed include many goods we take for granted and don’t have the capacity to produce within our own borders, said Mark Hamrick, Washington bureau chief and senior economic analyst at Bankrate.com. “Certainly agricultural sources in Mexico, they either become more expensive or unavailable,” Hamrick said. “Good luck eating dandelion greens for four months of the year.”

The threat of a 35 percent tax on auto imports from Mexico troubles Sam Stovall, U.S. equity strategist for S&P Global Market Intelligence. “That’s certainly going to hurt, because basically everything is imported, either in U.S. or foreign-made cars,” he said. And tariffs often spark retaliation, affecting U.S. exports as well.

On the other hand, if the tough talk succeeds in wresting concessions from partners, it could improve our trading position, Stovall said.

Your job

If Trump’s tariffs were enacted, including a 45 percent levy on Chinese goods, it would badly damage the economy and cost a lot of jobs, said Mark Zandi, chief economist at Moody’s Analytics. And if his tough immigration stance were put in place, Zandi warned, “it would be, to steal a phrase from him, a disaster.”

“If Trump could deport even a fraction of the 11 million immigrants, it would be very disruptive to business,” he said, creating a hole in an important sector of the labor force and removing a lot of consumers from the economy. “If he deported all 11 million, it could lead to a recession. It would be a mess.”

Your investments

Repatriating foreign earnings and possibly enacting some corporate tax reform, as Trump has discussed, could bolster stocks and benefit investors. Companies have twice as much cash on their books as they did 10 years ago, Stovall noted, and a lot of it is overseas. If they get more favorable tax treatment in the U.S. and bring that money back, they “will have additional money with which to do dividends, do share buybacks, and it could help companies looking to build new plants and equipment.” That, he said, could bring “better performance of the shares of the companies that we’re invested in in our 401(k)s.”

But a repeal of the Affordable Care Act “would do nothing but throw the health-care industry into a tailspin,” Stovall said.
A recent change in the candidate’s views on the minimum wage would affect such industries as retail and restaurants. Trump said earlier that he would not raise the wage but now says he is “open to doing something” with it, though Stovall doesn’t think he would go as far as $15 an hour.

There really is something to the maxim that Wall Street dislikes uncertainty, said Hamrick. It weighs on financial markets and the performance of the economy. “That Trump is unpredictable is quite distasteful for many people trying to price in risk and opportunity,” he said. “Certain businesses are going to be cautious about making investments until they have a bit more clarity, and that includes clarity on how the leadership of the Congress is determined. There’s a lot of cash sloshing around in the system, but it’s not being put to work.”

If a business is booming, the uncertainly is less of a factor, he said. “If you’re a business on the margin, however, and wondering if you should take a risk, you might be more risk-averse.”

Your taxes

The Tax Policy Center, which analyzed Trump’s proposal to reduce marginal rates for individuals and businesses while boosting standard deductions, says the plan would provide an average tax cut of $1.3 million to the top 0.1 percent of earners. It could also mean $9.5 trillion less in federal revenue over its first decade, the Center figures. If huge spending cuts don’t come with it, the group said, it “could increase the national debt by nearly 80% of gross domestic product by 2036, offsetting some or all of the incentive effects of the tax cuts.”

The proposal is in flux, however. Trump told CBNC this week that “when you put out a tax plan, you are going to start negotiating.”

Your plan

The smartest move you could make right now, amid the election year’s sound and fury, is simply to focus on building your financial future, said Kate Warne, investment strategist at Edward Jones. With so much uncertainty on both the domestic and foreign fronts, that means owning both bonds and stocks, especially international stocks while the dollar is strong, and diversifying both across and within asset classes.

And no matter what the candidates say, remember that the U.S. is running a budget deficit, so you need to prepare for the possibility of higher taxes, Warne said. Investing in tax-free municipal bonds and taking advantage of any tax-deferred accounts, such as IRAs and 401(k)s, is a great way to start.

In short, she advises, pay less attention to the political discourse and more to what you need to do now. Certainly don’t sit on the sidelines, she said. “Stocks don’t wait,” Warne said. “So you shouldn’t wait either.”

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Remembering Wall Street Crash in 1929

Remembering Wall Street Crash in 1929

In the autumn of 1929 came the catastrophe which so few had anticipated but which in retrospect seems inevitable–prices broke on the New York Stock Exchange, dragging down with them in their fall, first the economy of the United States itself, subsequently that of Europe and the rest of the world. Financial losses of such magnitude had never before been known in the history of capitalist society, and the ensuing depression was also unprecedented in scope.

There had always been business crises; economists had come to take them as normal and even to chart a certain regularity in their occurrence. But this one dwarfed all its predecessors: no previous depression had remotely approached it in length, in depth, and in the universality of impact. Small wonder that countless people were led to speculate whether the final collapse of capitalism itself, so long predicted by the Marxists, was not at last in sight.

On October 24, “Black Thursday,” nearly thirteen million dollars worth of stocks were sold in panic, and in the next three weeks the general industrial index of the New York Stock Exchange fell by more than half. Nevertheless, it was by no means clear at first, how severe the depression was going to be. Previous crises had originated in the United States–this was not the great novelty.

What was unprecedented was the extent of European economic dependence on America which the crash of 1929 revealed. This dependence varied greatly from country to country. Central Europe was involved first, as American financiers began to call in their short-term loans in Germany and Austria. Throughout 1930 these withdrawals of capital continued, until in May, 1931, the Austrian Creditanstalt suspended payments entirely. Thereafter, panic swept the Central European exchanges as bank after bank closed down and one industry after another began to reduce production and lay off workers.

Meantime the crisis had reached Great Britain. In September, 1931, the country went off the gold standard, to be followed two years later by the United States and nearly all the other financial powers of the world. The great exception was France: with a balanced economy and relative selfsufficiency, the French held off the crisis longer than anyone else–not until 1932 did its effects become really severe. But late involvement did not help the country in the long run: for France was the slowest and the least successful of the major powers in pulling itself out of the Depression, which left a wound in French society that was far from healed when the Second World War broke out.

The fall in production and the fall in prices everywhere reached unprecedented depths. In Germany–which was hit worst of all–production had fallen by 39 per cent, at the bottom of the Depression in 1932, and prices by only slightly less. In France, which was stubbornly holding to the gold standard, the price level in 1935 was just over half what it had been in 1930. But of all the manifestations of the Depression, unemployment was most grievous and most clearly left its mark on the whole era.

In this respect, France was the least seriously affected: the number of those out of work never rose above 850,000. But here as in Italy and in the agricultural nations in general, there was much semiemployment and concealed unemployment in the countryside. In Britain, the jobless numbered nearly three million–between a fifth and a quarter of the whole labor force. And in Germany unemployment mounted to the horrifying total of six million; trade-union executives estimated that more than two-fifths of their members were out of work entirely and another fifth employed only part time. With roughly half the population in desperation and want, it was no wonder that the Germans turned to the extremist leadership that they had so narrowly avoided in the crisis of 1923.

Elsewhere social unrest never reached such grave proportions, but throughout Europe governments and peoples felt themselves on the edge of a precipice, as the turbulent and questioning mood of the immediate postwar years returned with redoubled intensity. As had occurred during the war, a crisis situation evoked state intervention in the economy on a massive scale. Governments found themselves forced to resort to all sorts of measures of which the conservative disapproved.

These measure gradually came to follow a common pattern: most countries turned inward, trying to save their own economies without reference to, or regards for, their neighbors, through raising tariffs and setting up schemes for currency pooling and block buying abroad; they sought to relieve the sufferings of the unemployed through extended subsistence payments, on the model of the British dole, and to provide new jobs through vast programs of public works and, eventually, through rearmament.

Most of these measures were mere palliatives, however, undertaken in skeptical and hesitant fashion, and only after years of delay had robbed them of maximum effect. Furthermore, a number of them were of doubtful merit. The turn toward economic nationalism probably did as much harm as good–constricting the volume of world trade and still further reducing Europe’s share in it. In Europe, as in the United States, the only policy that brought much lasting benefit was direct provision of new employment by the government. Even this was far less effective in its original form of public works than in its subsequent guise of war production.

On both sides of the Atlantic, only rearmament proved a sufficiently powerful antidote to the Great Depression. It is sobering to note that the great power which was the most successful in pulling itself out of the slump–Nazi Germany–was also the one which plunged most whole-heartedly into preparation for war. Thus, by the mid- 1930’s, the economic and social struggles of the decade were blending imperceptibly into the origins of the Second World War itself.

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Is the American Dream still alive?

Is the American Dream still alive?

A new study shows that a majority of Americans are living the American Dream—even if they largely don’t realize it. The poll, conducted by marketing firm DDB as part of its 2014 Life Style Study, found that only 40 percent of American adults over the age of 18 believed they were “living the American Dream.”

That same 7,015-person study also found that sizable majorities reported owning a home, receiving a “good education,” finding a “decent job” and giving their children better lives than they themselves had—all traditional tenets of the American Dream. Although these findings may not seem intuitive, the answer behind this discrepancy could lie in an important trend in American financial security.

“Even though people report that they are not living the dream, they actually are when you look at the traditional benchmarks,” said Denise Delahorne, SVP, Group Strategy Director, DDB Chicago, who worked closely with the survey. She theorized that many people do not see themselves as having attained the traditional American Dream because of a shifting definition of the term.

Is the American Dream still alive?

“If you’re new to this country, then life seems pretty good here,” Delahorne said. “But for many people who have lived here a long time, they’ve started to think of the American Dream less as the traditional elements, and more relative to wealth.”

In the DDB survey, only 25 percent of adults reported that they have been able to “make a lot of money” in their life. But Erin Currier, director of economic mobility at The Pew Charitable Trusts, told CNBC she does not think the disparity between the DDB respondents’ life histories and their own assessment of American Dream fulfillment lies in an evolving definition. Still, she agreed with Delahorne: The explanation lies in wealth.

“[American families] have enough that they are able to consume those indicators of the American Dream, but they aren’t financially secure,” Currier said, drawing the distinction to an increase in citizens’ incomes, but not their wealth. “My instinct is that people feel that on a day to day basis.”

Because Americans are “treading water,” she said, they are too insecure to be able to enjoy their achievements. Still, Pew research from 2009 confirms that the elements listed on the DDB survey roughly align with what citizens see as the American Dream.

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The Panama Papers: Biggest financial leak in history

The Panama Papers: Biggest financial leak in history

Over 11 million leaked documents from the Panama-based law firm Mossack Fonseca reveal how some of the world’s richest and most powerful people hide their wealth in tax havens. It is being described as the biggest such leak in history.

It is claimed that secret offshore deals and loans worth $2 billion are linked to the inner circle of Vladimir Putin, although the Russian President is not himself named in the files which allegedly show some firms domiciled in tax havens were being used for suspected money laundering and tax evasion.

A Kremlin spokesman says the investigation was aimed at discrediting the president and had been conducted by former US intelligence staff.

Ukrainian President Petro Poroshenko is listed as having offshore wealth – one of 12 current or former leaders mentioned in the files. Around 60 people with close ties to leaders also feature including Li Xiaolin, the daughter of former Chinese Prime Minister Li Peng.

Argentina’s President Mauricio Macri, making headlines recently for the right reasons by hosting President Obama, is named in the data leak as is Iceland’s Prime Minister Sigmundur Davíð Gunnlaugsson, now under pressure to resign amid claims he failed to declare a stake in an offshore firm .

There is also embarrassment for Britain’s Prime Minister David Cameron, whose late father Ian is listed as a client of the law firm although there is no suggestion he did anything wrong.

The UK’s PM Is due to host a major summit on tackling ‘tax secrecy’ next month. And it is not only politicians who are implicated in the leaks with world football players of the year Lionel Messi and Michel Platini, the former head of European football’s governing body UEFA, also on the list.

Owning an offshore firm is not, in itself, illegal but with this leak raising claims of illicit activities, the ball is now in Mossack Fonseca’s court to respond. Reacting to the allegations, the firm has staunchly defended its reputation and vehemently denied any wrongdoing.

About The Panama Papers

The Panama Papers are a leaked set of 11.5 million confidential documents created by the Panamanian corporate service provider Mossack Fonseca that provide detailed information on more than 214,000 offshore companies, including the identities of shareholders and directors. The documents identify (as directors and shareholders of such companies) current government leaders from five countries — Argentina, Iceland, Saudi Arabia, Ukraine and the United Arab Emirates — as well as government officials, close relatives and close associates of various heads of government of more than 40 other countries, including Brazil, China, Peru, France, India, Malaysia, Mexico, Pakistan, Indonesia, Russia, South Africa, Spain, Syria and the United Kingdom.

Comprising documents created since the 1970s that amount to 2.6 terabytes of data, the papers were supplied to the Süddeutsche Zeitung in August 2015 by an anonymous source, and subsequently to the U.S.-based International Consortium of Investigative Journalists (ICIJ). The papers were distributed to and analyzed by about 400 journalists at 107 media organizations in more than 80 countries. The first news reports based on the set, along with 149 of the documents themselves, were published on April 3, 2016, and a full list of companies is to be released in early May 2016.

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The Recession Is Killing Romance

The Recession Is Killing Romance

In light of the recession, long working hours and a lack of cash are killing romance in British households, according to a new study released today, with 45% of Brits admitting that work leaves them too tired to go on dates and a whopping 64% claiming it was too expensive to do regularly.

The study, commissioned to mark the DVD and Blu-ray release of Date Night, revealed that whilst a huge 80% of couples believed dating to be an important part of a relationship, in reality one in ten admitted they only went on dates for birthdays or anniversaries whilst a shocking 12% claimed they hadn’t been on a single date with their partner in the last year.

Long-term relationships suffer the most with 45% of those surveyed revealing their relationship had lost its spark and a whopping 71% admitting that dating took more of a backseat the longer they had been together.

Dating is also a source of tension between couples with one in five arguing over what to do and where to go. Women were revealed as the biggest instigator of date nights, with 61% admitting they took the lead in organising them, whilst men went against type, admitting they would rather spend their Friday nights with their partner than out with the lads.

Relationship expert Julie Peasgood states: “I’m a great believer in couples still going on dates to keep the romance alive or to inject some energy back into a relationship.

“If financial or other constraints make this difficult, there are ways to creatively get round it, although what happens in Date Night is maybe a bit too radical for most of us! It’s a really funny film though, and a great source of inspiration!”

Attitudes to dating remain fairly traditional with two thirds stating that chivalrous acts such as holding doors open for women is an important trait in a man. Of those surveyed, 67% also agreed that the man should pay for the first date whilst 74% of male respondents described themselves as chivalrous.

Date Night stars comedy heavyweights Tina Fey (30 Rock, Baby Mama) and Steve Carell (The 40 year Old Virgin, Anchorman) as married couple Claire and Phil Foster who’s attempt at a glamourous and romantic evening unexpectedly turns into something more thrilling and dangerous!

The film is being released on the 13th September by Twentieth Century Fox Home Entertainment.

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Are you living the American Dream?

Are you living the American Dream?

The answer depends a lot on your income, according to a new survey.

Despite the “official” end of the recession over a year ago, life remains dull for much of the population: Nearly half the U.S. population does not live what they call the “dream U.S. “according to a new survey published this week.

StrategyOne, part of Daniel J. Edelman PR firm, surveyed 1,008 Americans and found 48% of respondents answered “no” when asked: “Are you living the American dream today?”

In households earning between $ 40,000 and $ 50,000 per year, only 41% responded affirmatively to the question. However, for households earning more than – those at or above $ 75,000 per year – 71% of respondents said they lived the American dream. This supports the idea that money might not be everything, but it helps.

The survey also suggests a lack of faith in the possibility of upward mobility: the 48% who said they do not live the American dream, more than half said they did not think they ever would.

Define the American dream, of course, will vary from person to person. Although stereotyped as one might think of the suburban house, the fence, a family, a sensitive dog and cars, which could be a long way from your own goals and reality. That said, the results strengthen the argument that from an economic standpoint, the locals are mixed in their views, regardless of what the academics argue.

Not surprisingly, official unemployment rate of nearly 10% – and worse by wider measures – and the collapse in housing prices has created considerable uncertainty. However, pockets of hope has been found. “Despite the doubts that were wondering if people have reached or will reach the American dream, 74% believe that the ideal of achieving the American dream and be able to” do in America is largely true and possible, rather than being just a myth. Sixty-eight percent of those households earning less than $ 25,000 per year also share this belief, “according StrategyOne.

The survey revealed that 81% of respondents strongly or somewhat (most were in this camp) “believe that if you work hard and playing” a middle-class life in the U.S. is available, 74 % say success is more a function of hard work, rather than good fortune.

So what’s the takeaway? The American dream is not dead yet, but it’s hard to maintain interest for many of us. Maybe we just need him to, and we find that it is still very much alive, that a different form. Let us know what you think.

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Rising food prices you’ll feel the most

Rising food prices you'll feel the most

Expect to pay more for groceries these popular because of shortages in the world.

Prices are up in grocery stores across the country. You may not notice changes right away, that bread can be only one cent more expensive than last year. Soda that you buy may be the same price but it is now 1.5 liters instead of two. Many major cereal manufacturers such as General Mills, warned of impending price increases.

Why Grocery Prices Going Up ?

While nearly all grocery aisles is affected by rising prices, a large part of the reason all comes down to two commodities: wheat and corn. The two staples have been hit hard over the last two years – a combination of climate change, natural disasters and crop diseases. Russia experienced a severe drought for two years and had stopped completely wheat exports to ensure sufficient domestic supply. They resumed limited exports of July 2011, but supplies are still far away. A disease called Ug99 wheat rust destroyed crops across Africa and spread to other wheat producing countries at a rapid pace.

There was a lot of bad harvests corn in North America as well, but the real culprit for corn is that it is used to make ethanol, a fuel probably sustainable. Hundreds of thousands of acres that once grew corn for the people now grow it to fuel our cars.

At first glance it may seem that these increases does not mean you will pay more for a few grocery items such as bread and popcorn, but wheat and corn are included in the vast majority of food you can eat every day. Here are four areas where you will see higher prices.

Rising food prices you'll feel the most

1. Cereals, breads and pasta products

Most cereals are made from corn and they will be hit hard by price increases in the coming year. The commodity price of corn has nearly doubled since 2010 and is rising again due to the massive drought in Texas is facing. Bread, rolls, cakes and biscuits will all rise in prices of steep jump in the price of wheat. According to food manufacturers, the industry has been holding the increase in retail prices, but can not absorb the costs any longer.

2. Sweets

Most treaties “candy” soda biscuits with jam, are made with corn syrup, high fructose. The lack of corn supply is causing prices to increase in these areas regularly. Beware of packages decreases, as well. Many companies will keep the same price but lower the amount you get.

3. Beef, pork and chicken

Almost all industrialized meat fed with corn, mainly because it was the cheapest food available. As the price of corn increases, there is still no cheaper alternative, so the price of meat increases due to the rising price of entry.

4. Cat and Dog Food

Pet food contains grains in one of two ways: treatment of dry foods often contain corn as one of its primary ingredients and canned food contains pieces of meat or wheat-based thickeners. It’s not just the cost of food will rise.

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U.S. downgrade and your credit cards

U.S. downgrade and your credit cards

Interest rates on cards are likely to be affected much differently than those on consumer loans.

Stocks have kept investors on edge during the past week as the Dow swings from boom to bust. For consumers, it’s a good time to step away from the market mayhem to survey the damage and potential threats to their finances.

One area that is getting short shrift — but shouldn’t — is the impact the Standard & Poor’s debt downgrade may have on credit card rates.

First, some background. The downgrade on U.S. Treasury bonds that was issued by ratings agency Standard & Poor’s — from AAA to AA+ — was widely viewed as a wake-up call to the U.S government and its “drunken sailor” approach to spending (though that might actually be an insult to drunken sailors).

While the Fed says it will keep rates near zero, many economists expect major consumer interest rate categories to eventually rise because of the downgrade, including things like mortgage, auto and student rate loans.

It’s no big secret why. Any consumer with a low credit rating knows that he or she is a bigger credit risk to lenders, and thus must pay higher interest rates for creditors to accept that risk and loan the consumer money.

It’s the same thing with Standard & Poor’s and the U.S. government. A lower credit rating means that global creditors face a higher risk of default when lending money to Uncle Sam. To borrow money — usually through the sale of U.S. Treasuries in the bond market — the U.S. government will have to offer higher rates of return to investors.

But here’s an interesting point. Even if Treasury yields do recover and grow again, your credit card’s interest rates may not follow the script. Why? Let’s look at three reasons:

Credit card rates aren’t tied to Treasury rates. Instead, credit card interest rates are tied to the Federal Reserve’s prime interest rate, which still remains historically low, and should continue along that path. Federal Reserve chairman Ben Bernanke has made it clear the Fed’s rate policy is to keep those rates down, despite what S&P says. That should help keep card rates manageable for consumers.

The CARD Act has a built-in safety net. Government can do something right once in a while. Take the credit card legislation passed in 2009: Inside the CARD Act is a provision that limits how much card issuers can raise rates. The reforms are limited to “current account balances,” meaning card companies can still raise rates on new charges, so be careful of new spending going into the last four-and-a-half months of 2011. But any charges you’ve already made are tied to current rates, which still remain relatively stable. A quick glance at BankingMyWay’s credit card rate search tool shows card interest rates stable between 11% and 20%, with the average credit card rate around 14%.

Standard & Poor’s doesn’t speak for everyone. Right now, S&P is out on its own with its debt downgrade. The other major U.S. credit agencies — Moody’s and Fitch ratings — didn’t go along. And until, or even if they ever do, don’t expect your credit card interest rates to rise significantly.

So call it a cloud with a silver lining. Yes, the stock market is taking a huge hit, but at least your credit card rate isn’t.

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20-somethings create their own jobs

20-somethings create their own jobs

In today’s economy, you can’t just wait around for someone to hire you, say young entrepreneurs.

Five years ago, after graduating from New York University with a film degree and thousands of dollars in student loans, Scott Gerber moved back in with his parents on Staten Island. He then took out more loans to start a new-media and technology company, but he didn’t have a clear market in mind; the company went belly up in 2006.

“It made me feel demoralized and humiliated,” he says. “I wondered if this was really what post-collegiate life was supposed to be like. Did I do something wrong? The answers weren’t apparent to me.”

Still in debt, Mr. Gerber considered his career options. His mother kept encouraging him to get a “real” job, the kind that comes with an office and a boss. But, using the last $700 in his bank account, he decided to start another company instead.

With the new company, called Sizzle It, Mr. Gerber vowed to find a niche, reduce overhead and generally be more frugal. The company, which specializes in short promotional videos, was profitable the first year, he says.

Mr. Gerber, now 27, isn’t a millionaire, but he’s paid off his loans and doesn’t have to live with his parents (he rents an apartment in Hoboken, N.J.). And he thinks his experience can help other young people who face a daunting unemployment rate.

In October, Mr. Gerber started the Young Entrepreneur Council “to create a shift from a résumé-driven society to one where people create their own jobs,” he says. “The jobs are going to come from the entrepreneurial level.”

The council consists of 80-plus business owners across the country, ages 17 to 33. Members include Scott Becker, 23, co-founder of Invite Media, an advertising technology firm recently acquired by a Google unit; Lauren Berger, 26, founder of the Intern Queen, a site that connects college students with internships; Aaron Patzer, the 30-year-old who sold Mint.com to Intuit for $170 million; and Josh Weinstein, 24, who started CollegeOnly.com, a social networking site that is backed by a PayPal founder.

The council, which has applied for nonprofit status, serves as a help desk and mentoring hotline for individual entrepreneurs. People can also submit questions on subjects like marketing, publicity and technology, and each month a group of council members will answer 30 to 40 of them in business publications like The Wall Street Journal and American Express Open Forum, and on dozens of small business Web sites.

Council members assert that young people can start businesses even if they have little or no money or experience. But whether those start-ups last is another matter. Roughly half of all new businesses fail within the first five years, according to federal data. And the entrepreneurial life is notoriously filled with risks, stresses and sacrifices.

But then again, unemployment is 9.8 percent; Mr. Gerber’s in-box is flooded with e-mails from young people who have sent out hundreds of résumés for corporate jobs and come up empty. According to the National Association of Colleges and Employers, only 24.4 percent of 2010 graduates who applied for a job had one waiting for them after graduation (up from 19.7 percent in 2009). What do some people have to lose?

THE lesson may be that entrepreneurship can be a viable career path, not a renegade choice — especially since the promise of “Go to college, get good grades and then get a job,” isn’t working the way it once did. The new reality has forced a whole generation to redefine what a stable job is.

“I’ve seen all these people go to Wall Street, and those were supposed to be the good jobs. Now they are out of work,” says Windsor Hanger, 22, who turned down a marketing position at Bloomingdale’s to work on HerCampus.com, an online magazine. “It’s not a pure dichotomy anymore that entrepreneurship is risky and other jobs are safe, so why not do what I love?”

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How to know when the recession is over

How to know when the recession is over

Many Americans just aren’t feeling the impact of the recovery in their daily lives.

Most economists think the recession technically ended a year or so ago, when the economy started growing again after shrinking for five quarters out of six. But a year’s worth of “recovery” hardly feels like it. Unemployment, at 9.6 percent, is painfully high, and companies show little interest in hiring. That leaves nearly 15 million unemployed Americans wondering what to do next.

Overall, Americans have lost $12 trillion in home equity, investments, and other forms of net worth. We’re ready to rebuild and go back to work, but instead of picking up steam, the economy seems to be stalling, possibly headed for a dreaded double-dip recession. The prolonged malaise could cost Democrats dearly in the upcoming midterm elections.

Healing is underway in badly damaged parts of the economy. But improvements have been too slow and subtle for many Americans to notice. Here are six ways to tell when we’re finally entering a recovery that feels like one:

The unemployed people you know start to find jobs. Unemployment is the single biggest indicator of economic health–or misery. Rising unemployment cuts into incomes and spending and spooks consumers, so it’s hard for housing, retail sales, and other key parts of the economy to recover until jobs come back. So far, they haven’t–but layoffs have largely stopped and temporary hiring is picking up, so we’re part of the way there.

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