Cramer: Surveying the damage

Despite my temporary need to murder Jim Cramer yesterday, because of his opinion of oil markets, it needs to be said; Jim Cramer has been nailing it with his commentary recently. The man is on fire, and I applaud him for it.

How much damage was done by the budget disaster in our country? How much damage could a collapse of the euro and the banks in the euro states do to the world’s economies?

Those two albatrosses could reverse any rally, stop any bull in its tracks. We are all trying to figure out how much impact these have had and could have. Does an ineffectual president and a fractious congress equal a 1% decline in GDP from levels that were low already? If Italy goes bust, does that mean we go into a second recession?

You have to visualize these crimes against the economy on a calm day, because on a down day they both seem unfathomable and on an up day they can seem trivial.

I think the dysfunction in the U.S. was a huge wake-up call to the world that, right now, we are politically bankrupt. The Standard & Poor’s downgrade crystallized what most are unwilling to say, which is that until our president loses in the election, which I don’t think he will, or the Tea Party obstructionist anarchists fall by the wayside, we can’t really have an economic recovery of any sort in this country.

That’s what so much of the earlier part of the decline was about. We won’t take the tough measures and our president is anti-capital and pro-labor. That others won’t say this is really a function of cowardice, because it’s all anybody talks about when you get off the desk or you turn the microphones off. The duplicity of so much of the media is frightening, because I don’t know a Republican or a Democrat who supports this president when it comes to economic issues. The leadership vacuum is palpable to all, but those in front of cameras fear retribution. I don’t blame them. The lash awaits.

Europe? More difficult. Of late, there’s a new school developing that is trying to put the 2008 moment for Europe in perspective. The prevailing wisdom is that the destruction of a currency plus several major bond markets plus many major banks just equals another Great Depression, maybe worse than what happened here.