Whose Recession Will It Be?
If memory serves, the 1990-91 recession was a function of two primary factors: the 1990 tax increase (then the biggest in history) and an accompanying credit crunch.
With Democrats looking likely to run the table in 2008, mammoth tax increases appear inevitable. Is the Fed already at work dropping the other shoe?:
I guess it comes down to which factor you think will have the bigger impact. It takes a long time for any macroeconomic adjustments to turn an economy as big as ours in either direction. And, of course, there's no guarantee that the Fed will remain this tight.
But if they do, the question will likely become when the public at large begins to notice the downward trend. Unlike 1992, when the recession hit and ended a year and a half before the election but the Enemy Media succeeded in concealing the Bush41 recovery from the public consciousness, it may be difficult for the Dems to talk down an economy that hasn't tanked yet. And if Mrs. Clinton wins anyway, she may have some difficulty avoiding the blame when it does.
That won't keep her from blaming it on Bush43 anyway. But it'll be a lot bigger concern for Dirty Harry and Crazy Nancy, whose bloated minions will have to weather the electoral storm a lot sooner than she will.
With Democrats looking likely to run the table in 2008, mammoth tax increases appear inevitable. Is the Fed already at work dropping the other shoe?:
The spreading credit squeeze is a problem that could become a large problem, which could become a huge problem. The Fed stuck to its anti-inflation guns yesterday, and would-be home buyers and home-sellers are screwed. "A growing credit crisis is prompting lenders across Massachusetts to cut back suddenly on new loans," the Boston Globe reported this morning, "making it difficult for even creditworthy borrowers to get mortgages and causing some home sales to fall through at a time when the housing market is already slumping."
The strangling of bad mortgage lending practices was a good move, but the smothering of mortgage activity is a serious indicator that overreaction to sloppy credit practices is having the sort of effect that can trigger recession. [emphasis added]
I guess it comes down to which factor you think will have the bigger impact. It takes a long time for any macroeconomic adjustments to turn an economy as big as ours in either direction. And, of course, there's no guarantee that the Fed will remain this tight.
But if they do, the question will likely become when the public at large begins to notice the downward trend. Unlike 1992, when the recession hit and ended a year and a half before the election but the Enemy Media succeeded in concealing the Bush41 recovery from the public consciousness, it may be difficult for the Dems to talk down an economy that hasn't tanked yet. And if Mrs. Clinton wins anyway, she may have some difficulty avoiding the blame when it does.
That won't keep her from blaming it on Bush43 anyway. But it'll be a lot bigger concern for Dirty Harry and Crazy Nancy, whose bloated minions will have to weather the electoral storm a lot sooner than she will.
posted by JASmius at 11:56 AM
<<< Home