So… explain to me again how the people who thought “the fundamentals of our economy are strong”…. not just within the past month, but all this year… are to be trusted to set things right?

Mal Carne on October 30, 2008 at 12:46 PM

Fox had been talking about the housing bubble for 2 years. We were waiting for the weakness to be exploited as a campaign tactic, but I don’t think even the Left realized what damage their interference would cause. The MSM tried to talk down the economy for well over a year and the talk down wasn’t working because unemployment was low and people were buying. Some of us, knowing that the Dems were losing Iraq as an election issue, tried to keep them from getting traction with the economy, and it was working.

Until someone pulled the trigger.

French President Nicolas Sarkozy is very critical of U.S. presidential candidate Barack Obama’s positions on Iran, according to reports that have reached Israel’s government.

Sarkozy has made his criticisms only in closed forums in France. But according to a senior Israeli government source, the reports reaching Israel indicate that Sarkozy views the Democratic candidate’s stance on Iran as “utterly immature” and comprised of “formulations empty of all content.”

http://www.haaretz.com/hasen/spages/1031943.html

2008. The year The One (Barack Obama) … Lost.

Obamalies or Lies Obama Tells
http://www.nextgenerationcorp.com/NextGenBlog/?p=73

So… explain to me again how the people who thought “the fundamentals of our economy are strong”…. not just within the past month, but all this year… are to be trusted to set things right?

Mal Carne on October 30, 2008 at 12:46 PM

The economy is fundamentally strong if you consider the supply side. Our economy has produced a ten-months supply of housing, has filled shelves with food and flat-screen TV’s, and without having to fight wars over land and resources (no, Iraq is not about oil, every $65 will get you a barrel of oil, no weapons required).

When too many homes are built, a fundamentally strong economy dictates reallocation of resources. Put the saw down and send the lumber back to 84. That sucks for many people, but to go on building would not be good for the economy.

The demand side is problematic, but that’s WE the PEOPLE. When we go past spending what we make to serially maxing out credit cars, recharging those with HELOCs, not to mention having bought overpriced homes before we could afford them so not to be “priced out forever,” at some point credit is used up and the spending has to slow down. That means recession if growth goes negative. Fred reigns in spending and Mike loses his job. Mike does the same and Fred loses his. The economic engine will still forge on, but will adjust for smaller demand.

So, if getting a people who have exhausted their credit to spend even more is what’s needed to turn around this economy, why would you trust want anyone in government to “set things right?” And if setting things right is putting lying CEO’s in prison, will it also include putting your neighbor who lied about her income to buy her home in prison as well? Will Obama put those folks in jail or will he instead rescue both groups by “restructuring” mortgages to save banks and borrowers at everyone else’s expense?

I know-Herbert Hoover-but I think you snuck one in.
Lighten up, people-it’s only an election!

Are you dense? I heard today that the unemployment rate in California was 7.7%, the highest in 12 years. But then again, 12 years ago was the age of Clinton when everyone was happy go lucky and there was no war or recession blah blah blah.

In fact when Clinton was leaving office a recession was on the way. There is nothing unusual about recessions. We get them periodically. That does not mean that the economy is not fundamentally sound.

sending the strongest signal yet that a recession may have already begun.

Almost every economist out there agrees that a recession is 2 quarters of negative GDP, but even this one shows a 0.3% increase.

Mal Carne

Joe the Plumber’ll fix it.

Is anyone surprised at the GDP drop?

How about everyone on the right who described the economy as ‘fundamentally sound’ and didn’t understand the scope of the financial crisis 6 or even 3 months ago?

Obama has the support of Warren Buffet for the same reasons that Clinton’s policies had the support of Alan Greenspan in 1992. Despite Republican claims that without lower capital gains taxes in 1992 the economy would enter a massive recession, Clinton managed an ecomomic turnaround based on policies intended to lower long term interest rates through actions that instilled confidence in the bond and other markets.

Either candidate faces a nightmare scenario when entering the White House in 2009. Although Cheney famously claimed that “deficits don’t matter” several years ago, Americans are about to find out why right wing policies are not only wrong, but dangerous to the country. Massive tax cuts for the wealthist didn’t create an ‘economic miracle’ of growth over the last 6 years. Now that the housing bubble has popped we see that those tax cuts only lead to a huge re-distribution of wealth from the middle class to the wealthiest Americans.

A US default or Weimar Germany scenario is entirely possible still unless that Bretton Woods II summit pulls a golden rabbit out of the empty monetary hat. That’s why it’s not a good idea to say we should just elect Obama and let him have this ugly presidential term and economic default/collapse blame. There’s nothing a Marxist radical acolyte wants more than to have power during that sort of crisis. It’s his lifelong dream to be able to “rescue” the failed capitalist system in America by blaming capitalism and replacing it with his pet political and economic system. He also gets to blame the last guy in office for everything that happened before and for all the new problems of transitioning.

Funny how that worked out, eh? Apparently, denial is a lousy economic tactic.

So… explain to me again how the people who thought “the fundamentals of our economy are strong”…. not just within the past month, but all this year… are to be trusted to set things right?

Nope: the recession is a phony
– Paul Murphy on October 30, 2008 at 11:57 AM

I agree, I think the economy was in the pool.

-FatOldGuy

Are you kidding? Bernanke is inflating the heck out of the currency. They announced unlimited dollars for banks a few days back. Where do you think this 700billion and all the other capital injections are coming from? Lord knows, we aint borrowing it anymore. We’re just printing it.

lodge on October 30, 2008 at 11:30 AM

Yeah, but inflation is a measure of all of the money and credit in the marketplace. At the very most, Bernanke’s move, should it cause the markets to kill the bears, will make for a flat rate of inflation. With the trillions of dollars that have evaporated this month, I have to agree with other commenters that we’re in a deflationary period right now. When bad loans are written off, that is negative on the credit side. When house prices drop, that’s negative on the credit side. When credit isn’t offered, all these other things happen, and other current loans are repaid, overall credit drops. If the current cycle isn’t deflationary, I don’t know what is.

As for the gas price, well, all the news can’t be bad, I suppose. That plus Bernanke’s printing press will make for weaker deflation, but it’ll still be deflation. In such a time, a stash of cash rules; weak interest beats negative growth anyday. When the market really looks to be turning around (and this isn’t it), 0-4% will once again be the realm of fools.

Great vid from TeachFreedom

http://www.youtube.com/watch?v=moTAI4VDIJw

Well worth the 8+ minutes.

How much do we really understand the Reagan Revolution of the 1980s? The clash of worldviews between Senators John McCain and Barack Obama have brought to light the nearly century long struggle between those who trust ever-increasing state power and those who seek to limit government, to maintain free markets, individual liberties, and the “under God:” traditions of our country. The second Reagan revolution is now underway.

Finally the price of gold over the last couple of weeks points to a deflatinary event. During one of the most intense economic times in our lifetimes the price of gold fell $200. If gold was a great investment for uncertain times it should be GOING UP not DOWN. Gold goes up during inflation.

Gold is going down because the dollar is going up. This dollar rally isn’t going to last though. Look at the fundamentals. Why would the dollar rally when the Fed is flooding the system with dollars? This rally is fake – maybe from deleveraging and hedge funds having to meet margin calls.

“It is a paradox that every dictator has climbed to power on the ladder of free speech. Immediately on attaining power each dictator has suppressed all free speech except his own.” Kevin in Washington State on October 30, 2008 at 11:59 AM

This is hardly paradoxical. It’s to be expected. The sine qua non of tyranny is intolerance of criticism.

(and if you disagree, you’re racist!!!)

/snark>

That combination proved disastrous the last time it was used — by Herbert Hoover.

An interesting quote from Hoover:

“It is a paradox that every dictator has climbed to power on the ladder of free speech. Immediately on attaining power each dictator has suppressed all free speech except his own.”

Don’t blame the Fed–blame the Fred(die Mac and Fannie Mae). Now who was pushing them to make bad loans? Chris Dodd and Barney Frank. Oh, sorry, thou shalt not speak ill of Democrats. My bad.

The Democrats have wanted a recession, have jawboned a recession, and now we have the makings of one. Gee, what a surprise.

In reality, however… the credit meltdown has been a disaster long in the making. That it happened just at the perfect time for Democrats is probably a coincidence.

Meanwhile the rest of the economy is strong, and a correction, however severe, in the housing market won’t derail it.

What could derail it is a bad election result: if the Democrats win we’ll get higher taxes, more trade restrictions, and reduced spending on economic drivers like defence. That’s a disaster waiting to happen.

But if enough Republicans win, particular McCain/Palin, none of these things will happen. We’ll see riots in Chicago, Denver, Washington, etc but fires are final consumption too. :)

Meanwhile the other big driver: oil prices, will stay low because the higher prices were never justified to begin with – and that means the economy will settle down, people will keep their jobs, and life will go on without a recession.

Harry Reid, Nancy Pelosi, and Barack Obama want to impose higher taxes in the face of a recession as well as put obstacles in global trade.

Obama just said “if I’m elected President, I will go through every entitlement line by line and eliminate those entitlements that are not working”.

GET OUT THE HISTORY BOOKS AND TRY TO FIND THE LAST TIME A DEMOCRATIC PRESIDENT ELIMINATED AN ENTITLEMENT!