Economic Crisis Is Too Advanced for Rescue

Layoffs just part of the problem, as states, consumers cut back
By Katherine Thompson,  Newser Staff
Posted Oct 5, 2008 1:24 PM CDT
People line up to attend a job fair in New York. New York's financial community, hit by the subprime mortgage crisis, has suffered thousands of layoffs in 2008, with many more to come.   (AP Photo/Mark Lennihan)
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(Newser) – September's spike in US unemployment numbers was the latest indication of a faltering economy, but the country's problems certainly aren't limited to layoffs. Unfortunately, the $700 billion bailout plan won't make things much better, analysts tell the Los Angeles Times. From consumer activity to state governments, the economic signs are all pointing south.

Manufacturers saw a shocking 4% drop in August, and after a slight bump in spending this year, consumers have just stopped buying. "We've got a really rough time ahead of us in 2009 and 2010," says one economist. Although the roots of the problem can be traced to the beginnings of the financial crisis, the bailout won't stop this slowdown.