Sometimes, I wonder if I am just tilting at windmills — i.e., my criticism of those two recent WSJ Op-Eds.
So I am heartened when I see someone I respect come to pretty much the exact same conclusion.
Run-don’t-walk to the Northern Trust commentary by Paul Kasriel today:
"Wesbury argues that the consensus forecast of professional (and I use the term advisedly) economists is more accurate than that of the lay public. That’s kind of like saying that German shepherds are smarter than German shorthaired pointers. That may be true, but in an absolute sense, neither is very bright. To argue that the economy is not in danger of slipping into a recession, as the lay public believes, because the consensus forecast of economists does not call for one is to ignore history. How many times has the consensus forecast of economists called for a recession? Although the lay public might have predicted eight out of the past four recessions, to paraphrase Samuelson, at least it has predicted some recessions. I am not aware of the consensus of economists’ forecasts ever predicting a recession. To Wesbury’s credit, he was one of only a handful of economists who predicted the last recession. (See, I’m fair and balanced.) The consensus did not." (emphasis added)
And, I love the title: You Know Things Are Bad When The WSJ Trots Out Malpass and Wesbury In The Same Week
Go read the whole piece . . .
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Source:
You Know Things Are Bad When The WSJ Trots Out Malpass and Wesbury In The Same Week
Paul Kasriel
Northern Trust Global Economic Research, August 9, 2007
http://tinyurl.com/2nh6rr
did’nt someone post that in a previous thread….I mean the title. swear I saw it here before.
Ciao
MS
I have a German shorthaired pointer; she’s smarter than many economists, and being prudent does not provide advice.
I resent the comparison.
Slightly off-topic, but – this volatility begins to feel like Spring of 2000…
Small Investor Chronicles™
Dear Larry Kudlow,
Goldilocks is down at the local precinct station where they’re taking a rape report.
She’ll be waiting for you pick her up a little later but she’s bruised and shaken and probably won’t believe a word you say any more.
And didn’t we see Secretary Paulsen on CNBC for the second time in a week yesterday as well?
And what does “repricing risk” mean anyway?
Isn’t that just a fancy/deceptive way of saying “your home and 401k are gonna be worth less than you thought very soon”?
Lots of respect for Kasriel
You will know that things are really bad when Kudlow stops showing the falling house from the Wizard of Oz when he introduces Gary Shilling. That will mean even Kudlow understands what is happening.
Don’t forget, the market is still up 1.5% for the week!! wtp?
[tongue firmly in cheek for you humorless types]
Slightly OT, but the CNN Money article on AIG reporting higher mortgage defaults has this to say:
“Foreclosures could explode, which would hurt everyone on the food chain: Borrowers lose their homes; lenders lose their payments; local governments lose tax base; and neighborhoods lose resiliency.”
This is the same sort of thinking that gets people thinking a bailout is the fair and prudent thing to do. But some of us assessed our options in the last few years, made the judgement that the market wasn’t right, and didn’t buy a house. Those prudent folks were not going to be bailed out if they were wrong (i.e. if prices kept climbing and they got locked out forver no one was going to compensate them for chosing poorly) but somehow there is this idead that no one had a choice and everyone is suffering and for god sakes won’t Congress bail everyone out?
I feel better. For now.
Word, Philip.
“Embrace Fear, Not Greed” Check out an amusing and personal Bear’s Manifesto at
http://www.slopeofhope.com/
Wordx2, Philip.
What a rube this Wesbury must be! Anybody that knows anything about Economics knows that UE is a LAGGING indicator. UE is usually at it’s lowest point when the recession starts. Put simply, businesses haven’t figured out that they have to lay people off yet. His entire argument is laced with BS like this…
Nofate wrote: “Anybody that knows anything about Economics knows that UE is a LAGGING indicator. UE is usually at it’s lowest point when the recession starts.”
Do not confuse the paid pundits with facts. Remember, their whole world view begins with, Once upon a time…
“You Know Things Are Bad When The WSJ Trots Out Malpass and Wesbury In The Same Week”
The brilliance of Paul Kasriel via The Big Picture.
Today has Luskin’s Op-Ed.
Thus, the WSJ incompetant idiot trifecta is complete!
Kudlow is in rare form this Friday afternoon. Nobody talked about helping the little guy, least of all the FED, after the Net Bubble burst, but 38 Billion dollars just today says that they are damn well helping their cronies on Wall Street. If the little guy gets a margin call, it’s tough shit for him, but these theives in suits can’t make a margin call and it’s FED to the rexcue. Efficient markets my ass!!!