Thursday, October 25, 2007

The Recession has been canceled

Just finished watching the CNBC interview with the Presidents economic team. After viewing that, I think that its time to seriously start shorting fertilizer futures. The good news is that there isn’t going to be a recession. The bad news is that only one or two economists has ever predicted a recession and been correct.

They claimed the employment figures were good and production was up. What do we produce besides drywall? Everything in our home that we have bought in the last five years has a label with the words “Made in China.” Of course food items don’t count but we do still produce most of them. Instead of stuffing corn in cows, we are making ethanol to put in your car. Your t-bone steak went to $10 a pound so you could corrode the hell out of your fuel lines, go figure!

The funny thing is, if the President’s economic team was to predict a recession, no one would believe them, just as they don’t now.

Housing literally walked into an open manhole. The increase in oil prices is the new Arab income tax. And the financial community claims that the smoke is necessary with all the mirrors they are using.

One of the group, Mr. Hubbard, also stated that inflation was “very, very low.” Here is a link to the interview transcript.

So I’m glad that's out of the way, there will be no recession. The Presidential "Sages" have spoken.


Anonymous said...

Not yet apparently.

Guardian, London 26 Oct
“Experts say that the housing slump has already knocked 1% off America's economic growth rate. "That's obviously not good," said Richard Iley, senior US economist at BNP Paribas in New York, who believes that there could be real damage if house prices drop by as much as 10%.
“"It looks as if nationwide house prices are really slipping into the mire for the first time since the 1930s," he said. "These are heavy blows raining in on the American consumer who, for years, has been heroically resilient."“

This was published on The Times comments:-
The economic growth of the Brown years was largely a statistical artifact created by excluding housing from the inflation figures. The economy has actually shrunk. Housing, transport, education, healthcare, government adminstration, defence, insurance, childcare, council tax, pensions, and conditions of employment are all worse or more expensive. Manufactured good as cheaper, thanks to China, as are computers. But manufacturing is only a small part of the economy.

The crash in house prices will make that obvious. However other major Western countries are in a much worse state than us. The tink tank is wrong there.
Malcolm McLean, Bradford, UK

McLean is quite right about the ludicrous figures used as "inflation" as GDPdeflator and supposedly "inflation protected" pensions and "benefits". Even by the "definition" that Economists have imposed on the English language, the British economy has been in slump for fifteen years.

Jim in San Marcos said...

Hi Keynes

I agree--it's going to get worse than a recession.

People think that the housing bubble has popped. I don't think that it has yet.

If you have ever been in retail, you would be amazed at the number of people who don't shop around before purchasing a big item.

There are still buyers out there that have no clue about the economy. I live in a well educated area and only about 1/3 of the residents get the daily newspaper delivered. To top that off, very few know much about economics, so when they say there is no recession it's very believable.