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Irrational Pessimism (The financial markets are healing)
American Spectator ^ | Dec. 2, 2008 | Brian Wesbury

Posted on 12/02/2008 7:30:24 PM PST by SeekAndFind

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To: JudgemAll
The culture of cheating is tanking everything. Just like with ENRON, no one is trusting anyone, it’s all corrupt.

The problem is that we are also dealing with a bipartisan culture of corruption. Enron had close business ties with the Bush administration and the Republican Party, just as Goldman Sachs and Fannie Mae were filled with Democrats. Most of Obama's incoming economic advisers are cut from the same cloth as those from the Bush Administration.

This author suffers from the same sort of misguided thinking that led to the attitude among many Republicans that deficits do not matter and that throwing a few trillion dollars at insolvent and mismanaged financial institutions and brokerage firms will cure the problem rather than merely postponing the inevitable. McCain's support for the $700 billion bailout may well have cost him the Presidency, as he went from a virtual dead heat with Obama to underdog status. The classic and Austrian schools of economics rightly teach that increasing the money supply will eventuate in the devaluation of the currency. They also eschew government intervention to thwart the business cycle.

The Obama Administration will be typically Keynesian, meaning that they will throw money at social and economic problems even more than the outgoing administration did, and increase taxes to boot. These measures will thwart recovery and prolong the downturn. However, unless the GOP returns to the free market principles of Goldwater, Taft, and Coolidge, a Republican restoration in 2012 will make little difference.

21 posted on 12/03/2008 5:37:40 AM PST by Wallace T.
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To: dr_who
"others claim there will be an “L” shaped recession"

Or maybe just a "\" shaped recession. Whee!

22 posted on 12/03/2008 9:49:00 AM PST by who_would_fardels_bear (The cosmos is about the smallest hole a man can stick his head in. - Chesterton)
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To: who_would_fardels_bear

There’s got to be a bottom somewhere!


23 posted on 12/03/2008 4:58:21 PM PST by dr_who
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To: misterrob
The New Era of Wealth : How Investors Can Profit from the Five Economic Trends Shaping the Future

Whoa! Now THAT'S just scary...

24 posted on 12/03/2008 7:14:15 PM PST by an amused spectator (I am Joe, too - I'm talkin' to you, VBM: The Volkischer Beobachter Media)
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To: dr_who

There some who would say the market just put in a double bottom.


25 posted on 12/03/2008 7:17:50 PM PST by csmusaret (I'd rather have a sister in a whorehouse than have a brother in the US Congress.)
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To: csmusaret

What’s a double bottom? Is that similar to someone with four buttocks?


26 posted on 12/03/2008 7:36:55 PM PST by dr_who
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To: dr_who

Nope. More like both buttocks.


27 posted on 12/04/2008 4:00:49 PM PST by csmusaret (I'd rather have a sister in a whorehouse than have a brother in the US Congress.)
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