Thursday, July 31, 2008
I Told You So
``We're in a recession,'' Allen Sinai, chief economist at Decision Economics Inc. in New York, said in a Bloomberg Television interview. ``It's going to widen, it's going to deepen.''It's the imputed incomes that really messed much of last year's stats.
The largest downward revision was for the last three months of 2007, as the previously reported 2.3 percent gain in consumer spending was reduced by more than half, to 1 percent. Americans cut back on the use of electricity and gas as fuel bills soared.
The brighter side is that this is a slow, creeping double-dip recession. According to my stats, we spent about 5 months negative, then turned and went weakly positive on an industrial/ag expansion which was just strong enough to boost services, and are now turning down again. However, it looks like we've got enough oomph (counter-cycle) still in the system that this second downturn won't be too deep.
Trough on the second downturn looks to be second quarter 2009, assuming that we don't do anything too stupid. What happens after that depends on government policy.
I won't be blogging for a bit because the new treatment works spectacularly well, but it is causing transitory problems, i.e., severe dyslexia such that I cannot write very well. I'm due to give myself the next shot in about two hours, which will probably make me illiterate for the next two days.
Have fun shrieking in the comments. When I can stop the symphony playing in my head long enough to write I'll continue. The economic paradox we are facing is that we truly need an old-time Dem in office right now. We have got to change our policies enough to put some stimulus into the lower half of the income bracket, and we don't have too many options to do it. We don't have the money to send people checks all the time, and we haven't been saving for retirements so we can't cut taxes much or at all on the bottom two-thirds of the income distribution. Our tax pyramid is sharp enough that we can't afford to raise them too much on the next 20% of the income distribution either, and if you target just the top you are asking for flight. Ronald Reagan did more to raise the incomes of the bottom half of the distribution than the modern Dems, which should tell us all something.
The question is "Can Obama be that Democrat?" It's obvious that Pelosi is the new breed of elitist Democrat that thinks quite differently than the old breed. She seems essentially Greenspan-like in believing that the solution is to crush the lower half of the population into poverty while saving the world, so even if Obama can be what we need, he would require a lot of support from the general population to get Congress to wake up and embrace reality.
What's required from policy makers now are business- (especially manufacturing-) friendly moves which must include an energy policy aimed at stability and much greater domestic production of energy, but those have to be combined with a reduction of business interests which have manipulated policies such as massive immigration which is not free to bargain, either because the immigrants are illegal or they are conditional residence serfs. In recent years we have shown a stunning ability to pick the worst of all possible solutions.
We're not going to get any help from ROW, because here is a list of some of the economies in or sliding into recession:
- Iceland, Denmark, Ireland, Spain
- Estonia, Latvia,
- UK, Italy, New Zealand
- France? Maybe their reforms will help enough to prevent it. Their 35 hour week policy has hurt them so much for so long that reversing it should really help to bolster incomes and spending.
- Australia is probably going to be in recession by fourth quarter.
- India is in a situation in which its PPI is exceeding income growth, so it will be a much weaker force of international stimulus.
- Indonesia and Malaysia are in some trouble; Indonesia's going to feel the impact of weak power infrastructure and Japan's weakness, and Malaysia will get a double whammy if growth in China slows significantly.
- With Europe sinking into recessionary territory, China will be hurt. China would be able to weather a US slowdown or a Europeans slowdown, but not dual recessions.
If we had a better ag policy, we could at least go back to handing out cheese and butter.
Here's the crazy thing. People are trying to make McCain out to be the elitist in this election.
A friend from my Bible study group forwarded this e-mail to me. I would encourage every Christian to send it to as many people as they can.
Even though Huckabee didn't win, we've got to do everything we can to make sure the party of Jesus keeps the White House.
Here's the e-mail:
I've been concerned that there are too many rumors going around about John McCain and I wanted to help set the facts straight. Please forward this email to everyone you know.
THE LIE: Combined, the McCain family has has a credit card balance that is more than $750,000 and their interest rate is 24.49%.
THE TRUTH: The McCains pay off their credit card bills on a monthly basis. The $750,000 figure is also wrong, though it is true that between January 2007 and May 2008, one of the credit cards did reach $500,000 and another reached $250,000.
Also, with a combined net worth over $100 million, most of the credit cards did not have any interest payments at all. Only their Visa, Mastercard, and Saks Fifth Avenue cards (monthly balances ranging between $15,000 and $50,000) charged interest.
THE LIE: McCain purchased two separate $4.7 million dollar condos in San Diego for their own enjoyment.
THE TRUTH: The combined cost of the two condos was $4.7 millon, and one of them was for the kids.
THE LIE: The McCains spent over $500,000 in 2007 on household staff, such as maids and butlers.
THE TRUTH: They increased their household staffing budget from $184,000 in 2006 to only $273,000 in 2007.
THE LIE: The McCains spent $11 million between the summer of 2004 and February 2008 on 13 different residences.
THE TRUTH: They spent $11 million acquiring five residences.
THE LIE: The McCains inherited a business worth $1,000,000,000 from relatives.
THE TRUTH: The McCains inherited assets worth more than $100,000,000 from relatives, but those assets are unlikely to be worth $1,000,000,000.
THE LIE: John McCain gambles away hundreds of thousands of dollars at the craps tables in Las Vegas.
THE TRUTH: While John McCain does frequently play craps in Las Vegas in continuous 14-hour sessions, it is unlikely that he has ever gambled away $100,000 in a single session.
We could use serious corporate governance reform. It would be best if it came from shareholders, but the way things are currently structured, it's institutional investors that have the means to impose it -- and they're not going to because they are part of the problem.
We could use tax reform. I saw an interesting post some time back at Political Calculations http://politicalcalculations.blogspot.com/2008/05/build-your-own-income-tax.html that suggests we could do a lot better with a simpler, progressive tax structure. In particular we could lift the working poor out of poverty and raise the same amount of money as we do now ... which means we could spend a decent chunk of 4% of GDP that we currently spend on failing to raise people out of poverty on something else, or cut rates. Again, the vested interests (Congresscritters and lobbying groups) have a lot to lose from reform.
Why throw in the word “elitist”? Did that enhance your analysis? Of course not. It’s just a gratuitous insult. What kind of a Christian actively seeks to insult other people?
Then we move to this:
“She seems essentially Greenspan-like in believing that the solution is to crush the lower half of the population into poverty while saving the world . . . “
You can’t back up a word of that, needless to say, so again, this is not analysis. It’s diatribe.
Decide what you want to be: 1) an economic/financial analyst, or 2) a third-rate polemist?
You’re not very good at either, so I’m not sure the choice matters.
NJCommuter - yes it will take a while, and as far as I'm concerned, anything and everything should be on the table. I am in favor of solar, wind, nuclear and even the new clean coal plants. However, we need to do this so badly that we MUST sit down and figure out what will work now and what won't. We can't afford to pretend any longer.
I also think we'll probably need an interim goal and then a final goal.
Basically we haven't kept up with the times. I'd say Rangel's proposal to cut down to 30% is at least worth a try. We don't have to be the lowest, but we shouldn't be way up at the top.
I agree with your point about management driving corporations into the ground while pulling huge compensation packages. Maybe this hump here will inspire shareholders to get a bit more demanding. I'm not sure how one would write effective laws to change things without unintended consequences. Maybe that's my limited imagination.
As for Pelosi - she's an elitist. Starkist doesn't have to pay minimum wages, Congress can't do what the SC asked Congress to do in Kelo (decide what "public use" is) because it's as if God has spoken to protect developer's rights, and who is she to desecrate the holy of holies? This woman, who claims to be trying to save the world from global warming, wanted a VERY big plane to ferry her individually back and forth to CA - need I go on? Ms. Organic Food Will Save The Planet Or At Least The Party is most certainly not tossing her lot in with the common folk.
In 2006 she was complaining that the Republican-controlled Congress had done nothing to lower gas prices, now she's quietly backing a gas tax hike. She voted against allowing construction or registration of new oil refineries. Very bad. She was pro corn ethanol which was hardly unique but has been extremely costly for those who aren't flush. She was one of the many who always block allowing Trade Associations to negotiate insurance the same way large corporations do.
Her husband has big RE involvement, which may explain her confusion about God and the Supremes. She voted yes to repeal Glass-Steagall, no surprise. As for the rest, try googling "Presidio Trust" and do a little intensive reading. Family business!
HOWEVER, she did do one very good thing - she voted against bankruptcy "reform". Consistently.
If things look backwards on the screen here, we'll certainly understand that it will flip back soon again. :-) I'll be praying for you!
“Economics inevitably has political implications, and politics usually has economic implications.”
True enough. Let’s compare how you deal with the intersection of politics and economics to Calculated Risk, a blog to which you post frequently.
CR does not push partisan attacks. He analyzes the data and draws conclusions. He’s critical of Henry Paulson and Barney Frank when the facts require. His analysis exhibits balance, perspective and honesty. And as a result, he is widely respected.
Tanta, well, her political leanings show through her writing, but – and this is key – she can back up her analysis with facts and reasoning.
How do you compare to CR and Tanta? Are you balanced, fair and honest? Do you disregard facts when they don’t fit your conclusions? Can you defend your assertions with reasoning and facts, or do you turn to name-calling and mere description?
Yes, it is your blog, but the beauty of blogs is that readers can challenge the blog owner/writer. Unlike CR and Tanta, you don’t seem willing or able to defend your positions.
“As for Pelosi - she's an elitist. . . . This woman, who claims to be trying to save the world from global warming, wanted a VERY big plane to ferry her individually back and forth to CA - need I go on?”
OK, the big plane story. You are aware, are you not, that the Sergeant at Arms for the House of Representative, Wilson Livingood, released this statement about the matter?
“In December 2006, I advised Speaker Pelosi that the US Air Force had made an airplane available to Speaker Hastert for security and communications purposes following September 11, 2001.
I told Speaker Pelosi that Speaker Hastert used the Air Force plane for travel to and from his district, however, I was uncertain of the rules and guidelines governing use of the plane. I offered to call the U.S. Air Force and Department of Defense to seek clarification of the guidelines.
Subsequently, several members of the Speaker’s staff and members of the Office of the Sergeant at Arms met with representatives from the Office of the Secretary of Defense and the U.S. Air Force liaison office to discuss the rules and guidelines which governed Speaker Hastert’s use of a plane. Several questions were posed to the Air Force and we are awaiting a response.”
This story has been so thoroughly debunked, only the nuttiest of partisans still believes it. Allow me to spell it out once again:
- Hastert had a military plane at his disposal. Why? Because he’s third in line of succession behind the President and Vice-President. If something happens to those two, you want the Speaker of the House to be in immediate contact to coordinate emergency response, right?
- Hastert’s district was in Illinois. Pelosi’s is in California. The plane Hastert used could make it to his district without refueling, but it could not make it to California without a stop for fuel.
- So, the Sergeant at Arms requested, and the Air Force agreed, that a larger plane would be required for Pelosi. You know, post-911 world and everything.
Now, what would you have said if Pelosi had said, no, if I take a larger plane that will look bad politically? Would you have her place political appearance over national security? Over proper foresight to protect the chain of command in case of an attack?
“Her husband has big RE involvement, which may explain her confusion about God and the Supremes. She voted yes to repeal Glass-Steagall, no surprise. As for the rest, try googling "Presidio Trust" and do a little intensive reading. Family business!”
And John McCain’s wife has a $100 million fortune, and George Bush’s father is quite wealthy, and Rush Limbaugh just signed a $400 million contract. So, can we agree that most people at the apex of power have wealth?
(Although, I must admit I can’t see the connection between real estate on the one hand and God and the Supremes on the other. I admit to being the uninformed dolt on that one.)
I can readily admit that John McCain has many admirable qualities – war hero, bucks convention wisdom occasionally, etc. Heck, I’ll even admit that George Bush won two elections – all Gore had to do was win Tennessee and then Florida wouldn’t have been an issue. I can say good things about Hastert (great triple cheeseburger eater) and Delay (happiest mug shot I’ve ever seen).
With you, what we get is this one-sided bile.
You come across as a bit unhinged. Well, that and willfully uninformed. Unnecessarily insulting as well.
And I still don’t see how you square your name-calling with, you know, following Jesus. I don’t think Jesus would approve of what you do.
Pelosi reminds me of the French aristocracy, circa Marie Antoinette. The old style Dems were never like that, think Humphrey, even Mondale. Can you imagine them insisting on organic chicken dinners?
One of the things I would like to see this election (and won't) is an insistance on companies developing their own training programs. Community college just doesn't cut it. They don't respond quickly enough with targeted programs, although they can be useful in setting up internships. We need a way to move people from school into jobs, so that the effort isn't wasted.
Gee, somehow I think that the blog was locked for anti-Obama statements, much like what happened to the sites run by Hillary Clinton supporters. So much for free speech.
Teri, Teri, Teri. Why are you sure I'm not a Christian? Because I don't agree with you and MoM?
"Jesus called more than a few people snakes or vipers."
True enough. Matthew 23:33 reads:
" You serpents, you brood of vipers, how will you escape the sentence of hell?"
Who was Jesus calling serpents and vipers? The Pharisees, right?
OK, who are the modern day Pharisees? The Democrats and the postmodernists? Is it really that clear and that easy to answer that question? Are you and MoM so arrogant to believe that you can answer that question? Are you suggesting that you are Jesus' equal? You are qualified to judge others?
Hmmm. The Christianity I know speaks of humility, serving, forgiveness and compassion.
But maybe you're right. Maybe Christianity is all about judgment, condemnation and persecuting enemies of Christ.
"Can you imagine them insisting on organic chicken dinners?"
No, of course not. That would be sinful.
"Gee, somehow I think that the blog was locked for anti-Obama statements, much like what happened to the sites run by Hillary Clinton supporters."
I'm with you on that. I love nutty conspiracy theories. Whenever possible, I too jump right past rational, mundane explanation and go right for the most outlandish possibility I can find.
Happiness is a warm plot.
There is an appointed time for everything, and a time for every affair under the heavens.
A time to be born, and a time to die; a time to plant, and a time to uproot the plant.
A time to kill, and a time to heal; a time to tear down, and a time to build.
A time to weep, and a time to laugh; a time to mourn, and a time to dance.
A time to scatter stones, and a time to gather them; a time to embrace, and a time to be far from embraces.
A time to seek, and a time to lose; a time to keep, and a time to cast away.
A time to rend, and a time to sew; a time to be silent, and a time to speak.
A time to love, and a time to hate; a time of war, and a time of peace.
That's a good point.
I've decided to come out of the shadows.
Oh, that feels better. Although I'm feeling a bit exposed. Everyone knows who I am now.
You're right, Teri, it does take courage to register a screen name.
Wait a minute. If your right about this, maybe Jesus is like the wrathful, capricious God of the Old Testament. Huh . . .
You know, it's not a book from the New Testament?
OK, that's not striking a chord?
Well, you know how Jesus was born in a manger, and, you know, that happened after the Old Testament was written?
Still not following?
OK, how about this. Jesus couldn't fight the Romans with an aircraft carrier because, ummm, how do I explain this? Well, there were no steel warships with aircraft at that time.
It's a function of time. Now if Jesus had been born in Tampico, IL on February 6, 1911, then yes, he might have been able to utilize an aircraft carrier task force to deal with the Romans, given sufficient executive authority and . . . .
"Do not think that I have come to abolish the Law or the Prophets; I have come not to abolish them but to fulfil them. I tell you the truth, until heaven and earth disappear, not the smallest letter, not the least stroke of a pen, will by any means disappear from the Law until everything is accomplished. Anyone who breaks one of the least of these commandments and teaches others to do the same will be called least in the kingdom of heaven, but whoever practices and teaches these commands will be called great in the kingdom of heaven."
Jesus came to fulfill the Laws and prophecies of the Old Testament. He did not do away with the Old Testament, but fulfilled it. He did invalidate the numerous rituals of the Pharisee's who had come to believe that the word, rather than the spirit of the law was of greater import.
Romans, Jesus and Aircraft Carriers? Uhhh...is this some of that Postmodernism in action?
You better get your facts straight.
Jesus wrote the Old Testament and the New Testament. Jesus was best known as a great teacher and fisher of men, but he was a very good writer, too.
And he was buff. Have you seen pictures of him? He was lean and mean, from being a carpenter and everything.
So, just remember, Jesus was kind and loving and all that, but he could kick some butt, too. You wouldn't last one minute with Jesus in a cage match! He'd knee you to your lefty chestnuts and chew your ear off, you post-homo traitor!
Wishing you good thoughts!
"Christianity does indeed speak of humility, serving, forgiveness and compassion. It also speaks of judgment, condemnation and the persecution of the enemies of Christ."
A Christian is one who judges, condemns and persecutes the enemies of Christ?
Either way, congratulations!
Still not following?
OK, how about this. Jesus couldn't fight the Romans with an aircraft carrier because, ummm, how do I explain this? Well, there were no steel warships with aircraft at that time.
It's a function of time. Now if Jesus had been born in Tampico, IL on February 6, 1911, then yes, he might have been able to utilize an aircraft carrier task force to deal with the Romans, given sufficient executive authority and . . . ."
Jas? Is that you? The words are different but the music sounds about the same...
China's industrial output is down for the fourth month running. New orders and export orders were down again.
In parting, it is true that Jesus is supposed to have won a major dustup in the court of the Temple. Apparently he had an issue with moneychangers (the international bankers of that day).
Personally, I do believe that Jesus would find some of the recent banking shenanigans merited a good shellacking. It's one thing to be writing unaffordable mortgages for speculators - there both parties are conning the other, although then the con got shoved through to some investors. It's quite another thing to be writing unaffordable mortgages on people's primary residences.
Matthew 7:1 “Judge not, that ye be not judged” means EXACTLY THAT. If you judge you should expect to be judged by the same standard you apply to others. It is not a call to sentimental Liberalism, but rather a caution against hypocricy as the reading of the following verses make clear. "Thou hypocrite, first cast out the beam out of thine own eye; and THEN SHALT THOU SEE CLEARLY TO CAST OUT THE MOTE OUT OF THY BROTHER'S EYE." - Matthew 7:5. This clearly endorses casting out the mote from thy brothers eye, but only if you are not being a worse hypocrite than him in your conduct.
"He that is without sin among you, let him first cast a stone". Following this Jesus sent the adulterous on her way telling her to “sin no more” which is being judgmental.
“Ye serpents, ye generation of vipers, how can ye escape the damnation of hell?” - Matthew 23:33
“O generation of vipers, who hath warned you to flee from the wrath to come?” - Matthew 3:7
And what about Jesus taking a whip to the moneylenders in the temple. Does that not sound at least a tad disapproving to you? MaxedOutMama is quite right here.
Thank you very much.
I work very hard at what I do, which is the misinformed but certain, violent id of the Limbaugh Christian. I'm sure you've met some of us -- we're quite numerous.
And please, no smoking or swearing as you wait in line for your own personal judgment day.
Thank you for your cooperation.
"Might want to take a look at the Bible sometime, Anonymous. Jesus called more than a few people snakes or vipers. And given that He was a carpenter that hung around with fishermen and such, I'm sure He heard a little blue language at times."
I hadn't thought about it that way -- Jesus hanging out with fishermen and lumberjacks and all.
So, Teri, do you think Jesus heard the F-word but didn't say it, or do you think he used it himself as well (you know, just to fit in)?
Cause -- I'm just thinking out loud here -- it might be perfectly Christian to tell people to F-off. I mean, if Jesus did it, why can't I?
But this is a sticky question, because the Bible doesn't tell us which of the seven dirty words Jesus used.
"Shit" is obviously OK, because Teri used it in another thread, and she's a Christian.
I'm not sure about coc . . . oh, I better not say it, cause I'm not sure if Jesus did.
Teri, could you assist us with this theological quandary?
Well, it's been a slice. I could argue with you until the cows come home. On second thought I'd rather argue with the cows until you go home.
It's World Net Daily, Rush Limbaugh Christianist zealots who, well, you know, they might want to seek help.
Professional help might be advisable.
But it's a free nation (albeit founded by evangelical Christians from the Republican Party).
You didn't read about Blogger blocking anti-Obama blogs? Check out this.
Let's see, what else did I miss. Jesus cussing--well Mark 7:19 is pretty earthy in the King James version. And there's the cursing of the fig tree, Mark 11:14. Must have been pretty stern language, don't you think? As for me, well just like you, I'm a sinner and I sometimes slip into the language I was raised around. I didn't know that perfection was required to post a blog comment, but ya never know. I did say a prayer for you this Sunday, whoever you are, because God knows you and he knows your heart. And now, I think I'm going to continue to focus on the reasons I read this blog, which have to do more with economics than religion.
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