Thursday, April 21, 2005

Don't Shoot The Messenger

When BushCo needs to fool the public on the state of the economy (or hint at future bad news-- which means that it's already hit the fan), they always trot out Alan Greenspan (Mr. Andrea Mitchell).

Remember, you can't shoot him; he's just the messenger.

Here's the Greenspan Report from two short months ago, on Feb. 16th...

Fed policymakers have a positive outlook for economic performance in 2005-2006

Fed Chairman Alan Greenspan delivered the Federal Reserve’s semiannual Monetary Policy Report to the Congress on Feb. 16 (to the Senate) and Feb. 17 (to the House of Representatives). Greenspan painted an optimistic picture of the current condition of the economy as well as near-term prospects. In general, Greenspan talked about solid economic fundamentals, good economic growth, declining unemployment and modest increases in core measures of consumer prices.

The Fed’s report to the Congress also presented economic projections by monetary policymakers (Federal Reserve governors and Reserve Bank presidents) for the 2005-2006 period. The central tendencies of those projections show solid growth in real GDP, a gradually declining unemployment rate, and maintenance of core consumer price inflation below 2%. These projections, which can be interpreted as Federal Reserve intentions, are quite similar to NAHB’s forecasts for 2005-2006. One thing we don’t know, of course, is the monetary policy assumptions behind the Fed’s own projections.

Solid growth.

Declining unemployment.

Inflation below 2%.

Fast Forward to today's Greenspan Report...

"Under existing tax rates and reasonable assumptions about other spending ... projections make clear that the federal budget is on an unsustainable path, in which large deficits result in rising interest rates and ever-growing interest payments that augment deficits in future years," Greenspan told the Senate Budget Committee.

He said that while the U.S. economy was "doing well," the danger was that deficits would keep rising as a percentage of total national output.

"Unless that trend is reversed, at some point these deficits would cause the economy to stagnate or worse."


Do you believe for one minute that our economy went from solid growth to Danger, Will Robinson! level in 2 months?

Had BushCo ever told the truth about their plans for the economy, millions of trusting taxpayers might have made vastly different choices during the last 5 years.

Not the least bit funny, but that Unabomber Shack may become the new rage in real estate investment very soon. It might be the only type of house millions of people can afford.

Heavy sigh.


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