As if I don’t have enough medical issues lately, the economic news has been schizophrenic. I hardly need any further incentive to enrich the medical-pharmaceutical complex, but that doesn’t stop the next round of economic hits comin’!
On the one hand, you have the exuberant Treasury Secretary Tim Geithner bragging that the long-awaited economic recovery is at hand, spinning the data so hard that pieces are beginning to fly off and endangering by-standers. Geithner has been joined in the kool-aid tippling by none other than the fantastical Federal Reserve Chairman Ben Bernanke, who is extolling the beneficial virtues of the higher wages that few workers seem to be enjoying.
On the other hand, grim Main Street Reality. The Salem News looked about the Bay State to check up on these gleeful ukases and discovered that it ain’t necessarily so. Using data from three economic indicators -completed single family home sales, and the confidence numbers of consumers and businesses- The Salem News deemed the Massachusetts portion of the recovery “feeble”. It’s not hard to see why when 25% of Massachusetts households have had someone out of work within the last twelve months.
Nationally, the home sale numbers reflect the findings of The Salem News. Those Marxist-Leninists at Bloomberg cited figures from the Maoist National Association of Realtors that found that existing home sales were down 2.6%. They attribute this decline to the successful limitation of the Socialist home buyers’ economic stimulus tax break by the Jacobin Congressional Republican delegation via comments issued by Dean Maki, chief U.S. economist at the Communist Barclays Capital Inc. in New York.
Maki noted that “a sustained recovery in housing now depends on employment and wage gains”, which only Ben Bernanke seems to be able to see. Maki also reported that “personal income and spending unexpectedly stagnated in June”, which he consideres proof that the economy has entered another slowdown.
The depth of this portion of the slowdown remains to be seen. The signs don’t portend favorable treatment for those Maki holds as the engineers of real estate recovery. One senior economist at Moody’s Economy.com Inc. -Ryan Sweet- forecasts that “The second half of this year we’re going to see slower spending.” His prognostication is backed by the news that the working class of Main Street is putting what extra coppers that can be gleaned from their daily toil into savings rather than spending. The incentive for doing so comes from figures which indicate that wages fell in June 2010. Those extra Red Lincolns might be needed when the pink slip arrives.
Nobel Laureate for Economics Paul Krugman worries aloud that our governing elite just doesn’t care. His J’accuse is aimed at a “Congress sitting on its hands” while it “cares a lot about taxes on the richest 1 percent of the population [and] very little about the plight of Americans who can’t find work.” He also doesn’t let the Fed off easy, but fears that the “unfocused anger” of the American people will allow both groups to continue to bleed the red-blooded economy white to protect the blue-blooded one.
But what IS a recessionized nation to do? We already know that the Fed is funding T-Bill purchases (paying around 2.6%) with 0% loans to the Wall Street banks, which has been a major factor in the recent reports that Wall Street is Back In Black. This leaves little money for any improvements in Main Street’s economic condition, which is now seen as the anchor holding recovery in place. We cannot count on either of the false-faces of the American Corporatist Party to do anything about this. The proposed Socialist small business economic stimulus bill -introduced in the House by the Democrats under rules requiring a two-thirds majority to pass- was successfully blocked by the Jacobin Congressional Republican delegation. There is no hope that the House of Lords -er, the Senate- will do anything meaningful either. The existing federal debt -now that the swells have been cared for- has become “too large” to provide any relief for those of us who pay the bulk of the taxes and receive the least of the benefits – and even those are endangered.
And what of the private sector, the hero of the Jacobin Congressional Republican delegation? Their numbers indicate that they are pulling in the Help Wanted signs. The Institute for Supply Management reports that fewer manufacturing sectors are still expanding and new orders have dropped sharply, unless one is a supplier to the Pentagon. War Is Still A Racket, eh, Smedley?
But the Blue Bloods need not fret that Them What’s Got will be Them What Gets To Pay. The Fed -more concerned with foreign investor confidence than anything else- isn’t about to advocate any further stimulus at this time, so neither increased federal spending adding to the deficit nor higher interest rates affecting loans are going to interfere with next year’s yacht purchase.
For the rest of us, we get yet another large helping of Audacious Hope. Someone better tell Rahm that November will be here ere long, and he’s nowhere near ready to receive it. And don’t think that Dick Daley is worried about a challenger, Rahm. You’ve already given him the smoking gun he needs to retire you permanently – and His Daddy Da Mare taught him how to be a Dead Eye Shot!