Posted on 08/04/2010 6:57:30 AM PDT by SeekAndFind
Economy: "Welcome to the Recovery," said the headline over an op-ed by Treasury Secretary Tim Geithner in the New York Times. At first we thought it must be a joke, maybe even a parody. It wasn't.
Welcome, indeed. The very same administration that promised unemployment wouldn't rise above 8% if we passed the $862 billion stimulus has dubbed the tepid economic rebound "recovery summer." They seem to think they deserve credit for the mess.
"The combined effect of government actions taken over the past two years - the stimulus package, the stress tests and recapitalization of the banks, the restructuring of the American car industry and the many steps taken by the Federal Reserve - were extremely effective in stopping the freefall and restarting the economy," Geithner wrote.
In fact, the economy's "freefall," as he put it, was stopped by the Fed's essentially printing nearly $1.2 trillion in new money - and, starting in December 2008, holding interest rates at zero, so that banks could essentially mint profits by borrowing at no cost and round-tripping the money into Treasury securities at 3% yield.
What's painfully apparent is that, if anything, the government's hyperactive interventions in the economy have held it back.
The "stimulus" was a farce from the beginning, promising a lot of "shovel ready" projects that would create thousands and thousands of jobs. They never came. But money did go to bail out the states - in essence, a government-to-government bailout.
(Excerpt) Read more at realclearmarkets.com ...
TARP, as we now find out, was a $700 billion boondoggle, a once-in-a-lifetime opportunity for Congress to raid the public till for pet projects. Now, a new report by Sens. Tom Coburn, R-Okla., and John McCain, R-Ariz., highlights 100 stimulus projects that not only didn't work, but are "being mismanaged or were poorly planned," or are "costing jobs and hurting small businesses."
But what did you expect? Government efficiency?
Even so, Geithner tries his darndest to make the current economic environment seem as if it's good and getting better, thanks of course to government intervention in the private sector.
As support he cites a recent study by economists Alan Blinder and Mark Zandi asserting that government actions since fall 2007 have saved 8.5 million jobs and increased GDP by 6.5% above where it would have been.
What he doesn't say is that the Blinder-Zandi "study" has come under broad criticism for making up numbers. All the estimated jobs saved and GDP created come from a Keynesian model using highly suspect multipliers. That is, the numbers aren't real-world data measuring real jobs; they exist only in a computer model.
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For those who missed Tim Geithner’s NY TImes OP-ED, it was discussed yesterday at FR here :
http://www.freerepublic.com/focus/f-news/2563720/posts
A jobless recovery is no recovery at all. Of the various difficulties that comprise a recession, joblessness is by far the biggest factor. Amazing how this is being downplayed.
Tim’s super high forehead is a vacuous blister of yellow puss.
Talk is cheap. Saying things are improving don’t mean things are improving. When unemployment drops below 7%, things will be improving. Ain’t gonna happen any time soon. And eventualy the inflated stock market will return to earth. Then the s@#t will hit the fan.
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