UPDATED: Economic Dissonance
I find it funny that when you listen to WDEL the economic news is always good. Today for example, the markets are going to be going like gangbusters since the interest rate was cut. Whoopie!!
But when you read actual economists, the bubbly optimism is had to find.
http://rs.rgemonitor.com/blog/roubini/231693
“And even the soft-landing optimists at JPMorgan are now recognizing that the likelihood of a US recession is now at its highest level in years. When mainstream analysts such as Berner start to talk about a recession being likely you know that the debate has clearly shifted towards a discussion of not whether a recession but rather how deep of a recession.”
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4:06 Update: Well it looks like the magic of the quarter point rate cut is wearing off.
Why single out WDEL? Try all of our corporate media.
I happened to be driving today so I heard the sunny optimism via WDEL – but you’re right. As far as MSNBC is concerned the Gravy Days are nigh.
As for why, it is really a no-brainer.
Economic reports include all corporate accounts as well as those of working people. These corporations are undergoing a windfall, and with paying no taxes, of course they are doing well. Their bounty hides the fact that everyone else is having a hard time.
One example to illustrate the point. Delmarva makes 60% more off their residential accounts than two years ago…Consumers are required to spend less on goods by that amount than they could two years ago. But the amount of money coming in and going out our your account, stays the same.
How to fix it. Kucinich, bless his heart, has the answer. Return the tax levels for all corporations back to 15%…Then start policy oriented decisions, like “well, if you move some of your jobs overseas back to America, we’ll cut a percentage point off for you….
Suddenly corporations have incentives to do the right things for America, not the wrong things as the Cheney plan allows.
All of the data supplied to the news media is backward looking (historical) and, when provided by the government, usually wrong (subject to revision). All economic forecasts are just that, forecasts. The best economist is the one that gets the forecasts rightest mostest.
As an aside, it usually takes about 100 economists to get a correct prediction, because only about one in 100 is right. Now to tell which one is right….
While I am in the camp that the economy looks like what I flush down my toilet, are you really shocked at the selloff today? These jackhole speculators overbought on the RUMOR that there was going to be a half-point cut. This, after barely a month ago, the solid speculation that it was going to be exactly what it was today: .25.
The rumor mills spin faster than the blogosphere in only one place: the financial markets.
Obviously market analysts felt the same way…It looks as if while composing your post, that is the exact time the sell off began…If we go into the second Great Depression, proof is there…Rick Jensen and his premature gloating about the economy,….. did it.
You know how some people are always saying that people who want to get out of Iraq are rooting for defeat?
Ironically, I have found over the past 15 years that somehow my family does better in recessions; I mean a lot better. On the other hand, when the market goes like gangbusters my family finances seem to go to shit (which was really why I hated the Clinton years). I am sure there is some reason for that which I am too economically illiterate to figure out.
But the upshot is that it puts me in the bizarre position of actually kinda sorta hoping for a recession that really is going to hurt the American economy so that my family can prosper.
Hey, that’s the American way, isn’t it?
You may have accidentally discovered why Libertarians are not one of the two dominant parties. What’s good for them, causes pain to others?
Steve,
What is your counter-cyclical buisness? Retreading truck tires?
No it makes those kitschy wire framed Californian styled bicycles that old ladies like to sit on their kitchen counters…..or is that a counter Cal-cycle business?
Forgive me.