Monday, June 8, 2009

When Be The Recovery?


The talking heads on CNBC have been making claims that the economy will soon be at an end. Hurray! That was easy, wasn’t it? Just toss some cash at the problem, buy up the private banking system and take over General Motors – presto, problem solved. What a great country we have. We are blessed, indeed.

The problem is that those talking heads are, for the most part, dependent on a recovery for their personal success. About half of the country has a vested stake in a recovery that includes higher retail sales, higher home prices and higher equity markets. The Halves and Haves, and have a great deal of depreciated wealth in their portfolios. These Halves are also part of the chaotic mixture of the Lefts and the Rights, sprinkled with a few in the middle. In this sense wealth transcends political boundaries and both groups have a lot riding on the hopes of a recovery, and both are wishing and praying that it manifests earlier than later. “Wish, wish, wish upon a star.”

The question, though, is whether or not projections and modeling techniques are viable indicators for this particular downturn. The recent “stress-test” applied to the banking system used unemployment data already proved deficient by the recently published 9.4% rate. Moreover, this does not appear to be a “normal” downturn. Normal in the sense that the government has taken unprecedented nationalism tactics to assuage ailing industries. Other differences include: rising interest rates on the heals of a near deflationary period; increased terror threats (we didn’t have that nagging booger in 1982); a rapid decline in our manufacturing base; a very real and healthy Green Movement affecting most aspects of public policy; multiple war fronts; a shrinking middle class; and a marginal line-up of summer movies.

Let’s all move to Wyoming and share in the wealth – maybe there is some mojo over there for the sharing!

2 comments:

Anonymous said...

With the various crises causing chaos and calamity all around us, I think it prudent to address the most salient of those issues, the paucity of summer movies. Is it instructive that Hollywood is more interested in same sex marriage, who is boning Jen, and indicting Dick Cheney than producing a vibrant summer fare. Although, I must admit, I'm kind of interested in who is bone jamming Jen myself.

Anonymous said...

Bush turned out to be smarter than most gave him credit for, he is saying nothing. Cheney as it turns out, is the real idiot.