Source: CCTV.com

11-07-2008 14:05

Special Report:   U.S.Presidential Election 2008

In the United States a crippled financial system and how to fix it took center stage at this year's presidential elections. Barack Obama may have triumphed but the hard work begins now. For the new president-elect, catchy slogans alone will not save a battered US economy.

In the United States a crippled financial system and how to fix it took center stage at this year's presidential elections.

Obama made it clear during the election that he understood auto makers' problems and would work to preserve the industry. General Motors and Ford are set to release their third-quarter results, which almost certainly will show billions in losses and cash burn rates. Further job cuts by both auto makers are expected on Friday. But even for those soon to be jobless, like this employee in the industry, Obama is still the right choice.

Matt Juerez said "I think Obama was the only one. I didn't have any faith in McCain. (Reporter: Why?) I don't know, I just didn't have any faith in McCain, he didn't seem like he really knew ... and he just kept talking about helping out the rich people, which the economy has been doing for this long already, so it is just like, I don't know, I didn't have faith in that anymore. I think you need to go ahead and try and help us out, the people that aren't making enough money to support everything. So I am hoping maybe everything will change now that Obama is in office. We'll see what happens now, huh?"

Many analysts believe the economy is already in recession, with data showing growth in the US economy dropping by 0.3 percent in the third quarter of the year, the most negative report in 7 years. To make matters even worse, consumption which counts for the biggest share in the US economy, slowed in the June to September period, the first decline in 17 years.

Professor Allan J Lichtman, Political Analyst said "The American public is looking for decisive action by Barack Obama that will address their immediate problems. Of course the economy is most important and that is a very difficult task for a president. The president doesn't have control over the economy, you don't easily fix the American economy."

But Obama also faces an immediate challenge he has to calm a very nervous Wall Street. Major indices plunged 10 percent 2 days after his victory. Some say naming the next Treasury Secretary and his top deputies, who will oversee the bailout plan, will be the new president's top economic priority.

Bob O'Brien, stocks editor of Barron's On-line said "He is expected to name a Treasury Secretary perhaps as early as the beginning of next week and that person would presumably begin playing a sort of consigliore role with the current administration as well as some of the officials at the Fed and Treasury who are executing on the bailout package. I think he would at least have a counsel role in that, he may not be making decisions but at least he'd be made aware of exactly what is going on."

Many are also wondering about new developments on a possible new economic stimulus plan, which may further increase the amount of government deficit. Analysts believe Obama lacks the funds to match promises made during the election, unless he is prepared to cut government expenditure and raise taxes.

 

Editor:Xiong Qu