May 29 2008
Sorry Dems – No Recession, Just Slow Growth
Life is not working out well for the Democrats who need to sow the seeds of doom and gloom in order to gain or hold power. They need to create the image of a battered and beaten America under Bush before the reality hits Americans that the Dems are the ones battered and beaten – and who lied to them.
If the Iraq and Afghan wars go well this summer – which all indications are they will – then the Dem fallback plan has been to moan about the economy. Working in their favor (primarily because they have let the energy crisis worsen by not passing any new policies in their defunct Congress) is the energy costs, which are hitting the pocket books of folks hard. Also in the favor is the real-estate price bubble correction currently playing out. Food prices are also up. But the best thing for the dems would be a recession, then they could really swoon about the evil GOP and Bush.
Sadly for them there is no recession coming to America anytime soon. In fact, if oil prices began to moderate again (which they very will could) and the real estate market finished making its corrections (which it will) then there could be an economic explosion as the pressures on the economy are released.
That would really hurt the dems, who now run on America’s failure as the only hope for their own gains in political power.
0.9% is slow growth but it isn’t horrible. Consider that sustainable growth is something around 3%. Having something close to 1% growth really isn’t a bad place to be during a “slowdown”.
I’ve made some good money on the runup of oil to $130, but it looks like it’s going to correct back to maybe $90 pretty soon. Always risky to predict a correction like that, but the energy markets right now sure feel like a bubble top.
Past that, the future depends heavily on what the Fed does with interest rates, which will determine whether the dollar rises or falls. I know, no one wants to believe that the Fed’s done as much to raise oil prices as anyone, but they have.
WWS
There is also a case to be made that for years the Dems held the dollar artificially high and that the dollar is closer to it’s real value and thus the price of commodities and gold and such are just reflecting their historically correct valuations.
After the last gold peak many central banks borrowed against their gold reserves to the point that the futures market had more contracts for delivery than could ever be delivered from world gold production.
Europe had an interest to prop it up also to cover their own inflation from their socialist policies and we may now be seeing something much closer to real true value and costs of oil than we have observed in a long time.
Which is exactly why the dems propped up the dollar so that their damaging energy policies could be hidden in plain sight.
I think Merlin might have a point here. I know I hate these gas prices, but commodity prices have been flat for years. In fact the price of corn in 2002 was less than the price of corn in 1982.
I heard the government has been doing an investigation on price fixing in energy markets, something to do with overseas trades or something. It has been going on for about 6 months. Anyone know anything about this?
Should we take bets now as to when the Democrats start claiming that their efforts caused the country to avoid a “depression” ?
There are three really funny things about this post. First, it is hilarious how AJ reached his conclusion that “there is no recession coming to America soon” and that the economy is on the verge of an “economic explosion” based on the article he linked. You people should actually read the article for a good laugh about these predictions. Here are some portions of this very same article that blow a big gapping hole through AJ’s prediction:
“56 percent of NABE forecasters believe that a recession has already begun or will develop this year. A panel of experts at the National Bureau of Economic Research determines when U.S. recessions begin and end, taking into account a variety of economic barometers. That finding is usually made well after the fact.”
“some analysts predict that slowdowns elsewhere in the world, such as Europe and Japan, will cool future demand for U.S. exports. That would mean exports could be less of a bracing force in overall U.S. economic activity in coming quarters.” (so much for the export industry keeping the economy afloat)
“What emerges is a picture of an economy that’s gasping for air,” said Bernard Baumohl, managing director of the Economic Outlook Group.”
Oh, I feel much better about the economy!
The second funny thing is that it reminded me of the last prediction AJ had about the economy that I recalled. On December 20, 2007, in a post entitled “The Soaring Bush Economy,” AJ actually made the following statement based solely on a strong thrid quarter GDP: “Words are meaningless, results are everything. For all the nay-sayers (right and left) regarding President Bush he has delivered this country one unbeatable economy in his tenure as President.” That was delivered shortly before the bottom fell out of the economy. Too funny!
Once again AJ, you take a minor indicator (weak, but slightly better than expected quarterly growth) and conflate it into something much bigger to convince yourself that you haven’t been wrong all along about the economy and Bush’s stewardship. Sorry to tell you AJ, but you have been dead wrong all along. And while I hate to say it because it doesn’t bode well for any of us, you are wrong once again. Things will eventaully correct themselves, but we are a long way from that happening.
The third thing that is funny – you people actually attempt to blame the Democrats for the problem. 6 straight years of GOP executive and legislative rule and it is still the Democrats fault. Just like 9-11 was Clinton’s fault! Do Republicans take responsibility or accountability for anything that doesn’t turn out well?
and right on cue, the third member of the unholy trinity pops up. Conman, Norm, Soothlicker – they all stay away together, they all show up together. What a surprise.
WWS,
Hey, at least I don’t simply rant like the rest of them. I usually back up my points with som,e support and/or references. This time I provided specific references to show that the article AJ relied on does not support his theory and that AJ has been dead wrong in is economic predictions in the past. Since you didn’t even attempt to dispute my points, I’ll assume you don’t disagree. The lack of substantive response and resort to the usual “there goes those liberals” is typically a tell-tale sign that you have no counter-argument.
Conman,
If you read the post slowly, so you could grasp its full meaning, I said “if” conditions changed in certain problem areas the economic growth would accelerate.
I did note the current problems (energy, housing, food). And I noted the lame Democrat Congress has done nothing to address them (except a pork laden farm bill).
The economy will not save you lefties! The reality is America is fine and will do fine. We are just in the last stretch of a grueling effort where lots of people wonder if we can get across the finish.
We will, and they will be proud, and they will never listen to a liberal surrender-nut again.
🙂
Go AJ!!!!!! Yes!
AJ,
You are right – I guess I missed the significance of your qualifying “if” scenerios. Now I think I understand what you were trying to say – if all of the major economic conditions creating the current recession correct themselves, the economy will get better. Thanks for pointing that out – we wouldn’t have been able to figure it out ourselves. While we are on the subject of qualifying predictions – I predict that if the human race decides to stop killing one another, we will have world peace. Wow, it sure is a lot easier to make predictions when you can ignore reality and make up all of the assumptions.
Conman,
In July please be sure to come back for your triple helping of crow – it will be here waiting for you!