More Bad Economic News
New home sales and consumer spending fell dramatically in May while unemployment is up leaving a worsening outlook for the US economy according to FT.
Krugman thinks we may be in a long Third Depression and need more Keynesian government stimulus spending to prevent the coming second dip in the US economy, and another 40 years of suffering.
Neither the G8 or G20 could reach a consensus on the path forward, with Germany leading the charge to reduce stimulus and address reducing debt while the US leads those who want to continue stimulus and more debt.
The Fed plans to print up to $3T to address deflation through quantitative easing. Consumers are saving and retiring debt rather than spending, banks aren't lending as they hoard cash against unknowable risk while the government borrows and spends like a drunken sailor.
Obama's take on his debt reduction plans :
"Somehow people say, why are you doing that, I'm not sure that's good politics. I'm doing it because I said I was going to do it and I think it's the right thing to do. People should learn that lesson about me because next year when I start presenting some very difficult choices to the country, I hope some of these folks who are hollering about deficits and debt step-up because I'm calling their bluff. We'll see how much of that, how much of the political arguments that they're making right now are real and how much of it was just politics."
You see, it's always about Obama and his politics. It's not about fixing this utterly wrecked economy. It's about making political points and retaining power over this sinking ship. Look for Obama to propose US defense budget cuts.
God help us.
Krugman thinks we may be in a long Third Depression and need more Keynesian government stimulus spending to prevent the coming second dip in the US economy, and another 40 years of suffering.
Neither the G8 or G20 could reach a consensus on the path forward, with Germany leading the charge to reduce stimulus and address reducing debt while the US leads those who want to continue stimulus and more debt.
The Fed plans to print up to $3T to address deflation through quantitative easing. Consumers are saving and retiring debt rather than spending, banks aren't lending as they hoard cash against unknowable risk while the government borrows and spends like a drunken sailor.
Obama's take on his debt reduction plans :
"Somehow people say, why are you doing that, I'm not sure that's good politics. I'm doing it because I said I was going to do it and I think it's the right thing to do. People should learn that lesson about me because next year when I start presenting some very difficult choices to the country, I hope some of these folks who are hollering about deficits and debt step-up because I'm calling their bluff. We'll see how much of that, how much of the political arguments that they're making right now are real and how much of it was just politics."
You see, it's always about Obama and his politics. It's not about fixing this utterly wrecked economy. It's about making political points and retaining power over this sinking ship. Look for Obama to propose US defense budget cuts.
God help us.
Labels: ecomomy
posted by lugh lampfhota at 8:39 PM
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