…another reminder that the best thing Congress and Comrade Obama could do right now is simply make sure that unemployment benefits are well funded nationwide and otherwise stay out of the way.
[Despite a tough employment report], stocks traded strong on Friday, with the Dow industrials finishing up over 200 points. Broad stock indexes are up 15% to 20% from their November lows. How can this be?
Well, the stock market is telling us that the economy’s future is a lot brighter than its past. The stock market looks ahead; the employment report looks behind.
Which is to say while this particular recession is a wee bit longer than most, it is otherwise reasonably predictable. Unemployment numbers will peak while the stock market moves up and small businesses and large corporations will start hiring again, usually before they are done laying off all that were slated for release.
By the way, in Friday’s jobs report, wages rose again, and now stand nearly 4% higher than a year ago. With zero inflation, that’s a real increase in worker purchasing power for the 92.4%, or 135 million workers, still employed.
Mr. President? Curious. I thought we were in the midst of a national catastrophe (actually we are – it started on January 20th).
…stocks may now be telling us that the gloom-and-doom crowd — and its pessimistic economic prognostications that cover all of 2009 and in some cases 2010 — is about to be proven wrong.
Or you could believe the President, what with his track record of truthiness and all. It’s going to suck to tell America “we screwed up” again and again.
The commodity markets — among the first asset sectors to respond to [the lowering of rates and increase in the money supply by the fed] — are stabilizing. Broad commodity indexes are 6% or so above their lows. Ditto for energy.
So, let’s spend a trillion dollars any way.
Barack Obama, a reputed master of the persuasive art, has settled on his central argument for the stimulus bill: I won.
That Obama is reduced to this crude appeal is a symptom of the intellectual collapse of the case for his stimulus bill, a congressional spendfest untethered from its stated goal of providing a rapid “jolt” to the economy.
Is there anything good about the Spendulus Package?
And as Art Laffer has taught us all, taxes also matter — a lot. In fact, the only real stimulative part of the behemoth stimulus package is the simple fact that marginal tax rates will not be raised.
Oh, you mean the Republican version. Gotcha.
So cheaper energy, bundles of new money creation, zero inflation and no tax hikes could very well combine to produce a stronger economy as the year progresses — to the great surprise of the majority of economic pundits.
…and to the dismay of The Little President that Cried Wolf.