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Wednesday, April 9, 2008

The Economy

The Economy

According to a report I heard on WMAL radio, March 2008 saw the biggest one month upturn in the stock market in more than 50 years. The balance of trade with foreign countries is the best it has been in decades. Inflation is cruising along at a very agreeable pace. And interest rates are at an all-time low.

So what’s all the talk about a recession? A recession is, by the way, a technical term which (if I understand it correctly) refers to two consecutive quarters of a downturn in economic indicators.
The truth is that a recession will happen only if the American people lose confidence in our economy. If they become uncertain or unsure, they start cutting back financially and that can snowball into a genuine recession.

Sure there has been a housing crisis. Greedy lenders together with greedy and ignorant borrowers created a crisis of sorts. The lenders offered short-term sub prime loans and the borrowers made bad decisions to take those loans. And yes, housing prices have declined significantly. That’s bad for home owners (although it doesn’t affect their standard of living), but along with the current low interest rates, that’s good news for first time home buyers.

Of course the Democrats and their allies in the mainstream news media think that an economic downturn is good news. They, of course, also think that more casualties in Iraq is good news and that higher gasoline prices are good news. What a pickle to be possessed of a philosophy that concludes that anything bad for America and its citizens is good news. If the US does go into a recession they will surely be dancing in the street!

How hard it is on these folks when the stock market heads upward, inflation stays down, there are fewer casualties in Iraq, and there is news of a new oil find in North Dakota.

Sadly, it’s all politics. It is bad politics that places power and control above what is best for your country. What a dismal outlook those on the left have.

Will the economy suffer from a recession? Perhaps. Like life, the economy has its ups and downs. When you consider the fact that George Bush inherited an economy much worse than the one we have today (it was actually in the tank, even though you wouldn’t know it from press reports), today’s economy is amazingly robust. That’s true in spite of the fact that we had to recover from 9/11, Hurricane Katrina, and finance a costly war.

The key was the Bush tax cuts which the Democrats promise to let expire. Moreover, they pledge to add additional taxes on top of that. If we avoid sliding into a recession in 2008, but go ahead and elect an Obama or a Clinton to the White House (along with a Democratic Congress), Katy Bar the door! If you liked the economy of Jimmy Carter you’ll love the economy of either Obama or Clinton. Stay tuned.

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