Stupid Economy? July 31, 2008 3:00pm by Barry Ritholtz Too true: Spread the wealth. twitter facebook linkedin What's been said: Discussions found on the web: Mel commented on Jul 31 Jr. screwed up more than just the economy. VennData commented on Jul 31 The FASB – under pressure from Jr.? – decided to delay the rule that forces big companies to bring off balance sheet items, SIVs and such, onto their balance sheets. Do you think think wouldn’t have happened if Bush/Paulson/Cheney et al had anything to say? Now this shouldn’t have any real impact on equity prices since we all know the SIVs are out there… just like we know that Jr.’s $500B deficit is really more like $800B (Iraq, Afghanistan, Social Security coverage etc.. are off-budget.) So, where’s my “off budget?” Mark E Hoffer commented on Jul 31 Not being sure where to ask this Q, so I’ll it here: How does Oil closer to U$D 50, than U$D 100, play out for the Economy? (yes, read that as under U$D 75) Dervin commented on Jul 31 The sad thing is GHWB was pretty responsible on the economic front and was cleaning up a lot of Reagan’s mess. I always think that GWB was GHWB’s revenge against the psychos of the GOP. A Greenwich Candidate, if you so please. algernon commented on Jul 31 Tho’ both Bushes were pretty sorry presidents, the economic woes of their periods of presiding have about as much to do with their policies as the DotCom bubble had to do with Clinton policies…very little. Bush II’s tax cuts were beneficial; his profligate spending (including Iraq), harmful. But all of that is overwhelmed by the global credit bubble & its on-going collapse. Marcus Aurelius commented on Jul 31 Cartoons are okay, but I’d rather see an indictments. Bush is no longer a joke. Marcus Aurelius commented on Jul 31 Cartoons are okay, but I’d rather see an indictments. Bush is no longer a joke. Marcus Aurelius commented on Jul 31 Cartoons are okay, but I’d rather see an indictments. Bush is no longer a joke. Marcus Aurelius commented on Jul 31 Cartoons are okay, but I’d rather see an indictments. Bush is no longer a joke. John commented on Jul 31 Dervin; Agree entirely about Bush pere. He put his country before his party by breaking his tax pledge and his party hate him for it. No matter that it was necessary to clean up the oceans of red ink left by their dream lover, he raised taxes hence he’s a skunk. It wasn’t enough of course and Clinton had to raise them again. I voted for him over Clinton in 02 and thought and think him a good public servant who used the rules of the game to his advantage but basically respected the system and constitution. He left the country stronger than he found it which is more than can be said for is offspring. From being a mild Republican I’m astounded at the cesspit of corruption, incompetence and hypocrisy that my party has become. They have neither morality or commonsense. There was a story in the WSJ today that summed it up, apparently they are attempting to slip by the back door some new DHS regs that would define contraceptive pills and IUD’s as abortive elements in order to satisfy their far right constituents. I’m sure the women of America are going to rise up in applause for the news that it’s rubbers only in future. CNBC Sucks commented on Jul 31 For all the portrayal of George W. Bush as an idiot, I think you actually have an economy concocted by Larry Kudlow’s “investor class” like the Laffers, Luskins, and that Ewok fellow you sometimes see on Kudlow & Company. Don’t blame George W. Bush for this economy, blame the economic puppeteers of the Republican Party. I would even say that the guy everybody hates so much, our Vice President Richard Cheney, just may have been a moderating force against the ravenous high priests of trickle down theory and worthless dollar wealth. With John McCain, who has no intellectual capacity nor interest to actively engage in economic policy and who will have no adult supervision, Larry Kudlow’s investor class will have even more of a free reign over the economy. Greg0658 commented on Jul 31 CNBC.. writes – with John McCain … Kudlow’s investor class will have even more of a free reign over the economy exactly – and why the trial balloon of John McCain doesn’t speak for the Republican Campaign for President was floated this week thats sort of true – the front man doesn’t make the team – the team can change this game … and we need change b commented on Jul 31 Yes, we need change, change we can believe in!….. ha ha, idiots. nothing but an empty suit, all of them. donna commented on Jul 31 One speeds up the decline, the other *might* slow it down enough that we have a chance of pulling our economy out of the funk. Backwards and into the shithole with McCain — or move forwards with Obama — your choice, folks. Just check out the economic advisors if you doubt it. BlackSwan2008 commented on Jul 31 Leave George Bush Alone!!! John commented on Jul 31 CNBC Sucks: Remember O’Neill’s characterisation of GWB. A blind and deaf man. No he’s not an idiot but neither does he have the mental capacity to be President in 2008. I liken him to the reasonably intelligent son of the local Ford dealer, expensively educated, party boy, Dad made him come into the business when he was about 45. He sits there with not much clue about how the business works, utters the odd buzz word, and is relatively easily manipulated by stronger and more focussed men who defer to him in public where they often have to prop him up and snigger behind his back. I’ve worked with people exactly like this in multi billion dollar corporations and I remember clearly on one occasion a heavy trying to explain that his nominal boss who was a Bush type was to be taken seriously. Obviously you don’t believe in the philosophy of the buck stops here because when you audition for the role of president you’re expected to pull your weight. As for the picture of Dick Cheney as enemy of trickle down, don’t you remember that other quote from O’Neill’s book when he remonstrated about the possible ill effects of huge tax cuts, Cheney said our people ie. the very rich like himself, have earned this, or something similar. There aint no way you can give these guys a pass for the present mess. Jon H commented on Jul 31 CNBC Sucks wrote: “the guy everybody hates so much, our Vice President Richard Cheney, just may have been a moderating force against the ravenous high priests of trickle down theory and worthless dollar wealth. ” That would be Dick Cheney who said “deficits don’t matter”. And clearly this has been the guiding principle of the Bush years. JC commented on Jul 31 Bush II is a generational president. It will take a generation to undo the damage he has done – so far. He’s still got 6 months to attack Iran and usher in the Great Depression II. He bankrupted his own company, now he’s doing the same to our country CNBC Sucks commented on Jul 31 My brothers, I hope that your antipathy toward the present Republican administration translates to energy and action toward preventing another one. Please do not lose my message: If you think things are bad under the Bush / Cheney Administration, it will be twilight for America under John McCain. Please do all you can to make sure Barack Obama and the Democrats win in November. Thanks. VJ commented on Jul 31 algernon, “Bush II’s tax cuts were beneficial…” How is throwing money at the Rich & Corporate, with the resulting massive federal deficits and debt, considered “beneficial” ? . scott hutch commented on Jul 31 i’ve always liked “it’s the economy, stupider” OhNoNotAgain commented on Jul 31 “How is throwing money at the Rich & Corporate, with the resulting massive federal deficits and debt, considered “beneficial” ?” Maybe he left off the “for me”. :-) drey commented on Aug 1 “If you think things are bad under the Bush / Cheney Administration, it will be twilight for America under John McCain.” Twilight for America? Shit – this is the fall of the roman empire only we have cable TV instead of lions eating Christians in the Coliseum… I don’t disagree with your dread of a brain dead McCain administration but not to worry – FUBAR economy will create an Obama landslide by the time November rolls around. Problem is that GWB will leave such a fiscal and geopolitical mess that not even Superman would be able to clean it up. His final budget is $480 billion in the red for crying out loud, not counting a lot of the off budget stuff… I want the motherfucker brought up on charges for lying, murder, and gross malfeasance. Not likely to happen with a completely polticized Justice Dept, however. These assholes knew exactly what they were doing. That’s OK – he can answer to his children, and to history. pkut commented on Aug 1 can someone explain to me how massive tax increases, increased government regulation, the destruction of private contracts, a massive increase in gov spending, greater union clout, less free trade, increased power of tort lawyers, and near government takeover of medicine will improve the economy and make the US more competative globally? pkut commented on Aug 1 btw, what is the current debt to gdp ratio and how does it compare historically? OhNoNotAgain commented on Aug 1 “can someone explain to me how massive tax increases, increased government regulation, the destruction of private contracts, a massive increase in gov spending, greater union clout, less free trade, increased power of tort lawyers, and near government takeover of medicine will improve the economy and make the US more competative globally?” Um, you’ve apparently slipped into a wormhole and come out in a parallel universe. Do you want us to phone some scientists and see if they can get you out of there ? David Davenport commented on Aug 1 I bet some of you bien pensant whiter-than-white peepul ostentatiously praising NoBama will push the button for Bob Dole II in the privacy of the voting booth this fall, … thinking about those tax increases. Greg0658 commented on Aug 1 Posted by: b – “nothing but an empty suit, all of them” that’s all we have in a democracy … you will not survive a revolution (in a happy state of mind) drey – don’t ask for to much! tonymagoo commented on Aug 1 The Bush’s are proof that the Brahmans should no longer ‘rule’ in the US of A. winslow commented on Aug 1 I look all around and see America in despair. Definitely , the last 8 yrs have been horrendous. What I don’t understand, where is all the loud protests. Gas is at $4/gallon and there is no long-term energy policy being developed. There should be marches and protests in every state. The combination of complacency and idiots in high positions (government and business) are leading America into the abyss. AJ commented on Aug 1 Bush II is a disaster but the real question is whether the US electorate has smartened up. In 2000 an at best mediocre manager was chosen over an at worst decent manager. In 2004 a proven incompetent was chosen over someone who couldn’t be worse and now huge numbers are supporting McCain, who has no clue about management, over Obama who up to this moment makes a more than decent showing as a manager. Robert commented on Aug 2 This cartoon does bring back memories of the ’92 campaign. A mild recession characterized as a depression. Do you remember “the worst economy in the last 50 years”? I guess Obama will soon call it the “worst economy in the last 66 years”. Media collusion. A clueless narcissist talking about hope and change. The parallels are eerie. There is only one question if Obama gets elected. Will Americans revolt and elect a congress to save himself from his policies, like they did in ’94? VJ commented on Aug 2 Robert, “This cartoon does bring back memories of the ’92 campaign. A mild recession characterized as a depression.” It was NOT “characterized as a depression”. “Do you remember ‘the worst economy in the last 50 years’?” Yep. Do you remember that Poppy Bush presided over a four-year presidential term with the slowest economic growth in 50 years ? Do you remember that Poppy Bush presided over a four-year presidential term with negative private-sector job growth, the first time in 50 years ? . Adam commented on Aug 2 Now the real question is will Obama’s protectionism help or hurt the economy. Well at least he has Robert Rubin, so he will flip flop on his protectionist tendencies. With Rubin in charge we actually might have a fiscally conservative president again. Robert commented on Aug 3 I tell you what I do remember. I remember my father trying to drum up work as a carpenter in the late 70’s, early 80’s with interest rates so high nobody would dream of building a house. That was real misery. When you say “worst economy in 50 years”…in 1992…you are in effect saying it hasn’t been this bad since the depression. Bullshit. I guess if “poppy” had raised taxes more we would have had private-sector job growth, hmm? ajay_kumar commented on Aug 3 It is so satisfying to see all those moronic comments above. I thank the almighty he did not create many smart people otherwise I would never have achieved the success I was able to. To educate some of you economically challenged, there is some thing called business cycle which has existed since man climbed down from the trees. Even your beloved Clinton had a horrible downturn in economy in 1994. And then he gave us the mother of all bubbles, the dot-com bust. But it was not really Clinton’s doing. In reality presidents have very little control over economy. The Chairman of federal Reserve has much more influence on economy. As for Bush43 being a disaster, have you already forgotten the twin blows of 911 and Katrina? If it was not for the taxcuts of Bush43, the economic cycle would have bottomed a lot sooner than 2008. Blame Greenspan for the horrendous housing bubble because of his dropping interest rates to 1%, way below inflation rate. The normal decline in economic cycle is exacerbated currently due to the housing bubble meltdown. As for tax cuts benefiting the rich, have you ever observed a poor person ever create a meaningful job for another person? It takes CAPITAL to create a business. It takes a business to create jobs. If you don’t understand that, you are doomed to be an economic failure for life, as it should be! Greg0658 commented on Aug 3 ajay writes – “It takes CAPITAL to create a business. It takes a business to create jobs.” and the other side of that trade is It takes a common worker in a job to buy a product created by business to create that business. Get it paper pusher mouthpiece (as you protect your cut). VJ commented on Aug 3 Adam, “Now the real question is will Obama’s protectionism help or hurt the economy.” Obama’s protectionism ? He’s already flip-flopped on that too, since the primary: * Obama told Fortune Mag he no longer believes in unilaterally reopening NAFTA: “I’m not a big believer in doing things unilaterally,” Obama said. * Obama told CNBC: “Look. I am a pro-growth, free-market guy. I love the market.” . VJ commented on Aug 3 Robert, “When you say ‘worst economy in 50 years’…in 1992…you are in effect saying it hasn’t been this bad since the depression.” The 1992 Clinton/Gore Campaign simply stated the facts. You just don’t seem to like the facts. . VJ commented on Aug 3 ajay_kumar, “To educate some of you economically challenged…” I’m afraid you are in dire need of a remedial class in basic economics. “…there is some thing called business cycle which has existed since man climbed down from the trees.” The RightWing always drags out that old canard in a desperate attempt to diminish the performance of a Democratic administration, or excuse the horrible performance of a Republican administration. If it is all merely a business cycle, why is it that the Fickle Finger of Fate never lands on prosperity for the Republicans ? “Even your beloved Clinton had a horrible downturn in economy in 1994.” ???? 1994 GDP: 4% “And then he gave us the mother of all bubbles, the dot-com bust.” A) Exactly what public policies enacted by the Clinton administration “gave us the mother of all bubbles” ? B) The “dot-com” was a TINY FRACTION of the overall national economy. Overall retail sales in 2000 amounted to more than $3.2 Trillion. On-line retail sales in 2000 amounted to something like $50 Million. You do the math. The “dot-com bust” was a quite obvious, at the time, stock market bubble primarily relegated to the NASDAQ. “As for Bush43 being a disaster, have you already forgotten the twin blows of 911 and Katrina?” Not at all. Both merely reinforce his label of being “a disaster”. “If it was not for the taxcuts of Bush43, the economic cycle would have bottomed a lot sooner than 2008.” The recession began BEFORE 9/11. The tax cuts for the Rich & Corporate impeded the economy. “As for tax cuts benefiting the rich, have you ever observed a poor person ever create a meaningful job for another person?” Of course. Tax cuts for the Rich & Corporate have NEVER created jobs in the national economy, increased the national GDP, or generated increased federal income tax revenue. “It takes a business to create jobs.” That is the failed ‘Supply-Side Theory’ of economics. We are a DEMAND economy. More than 70% of the national economy is Consumer Spending. Consumers create jobs, not businesses. . Greg0658 commented on Aug 3 VJ – I’ve said this before, I’ll say again, cause I still believe it The Clinton boom years were both these factors – China building a factory base with our machinery and the American consumers buying all the cheaply produced product. And I’ll say it again – after MEW and credit card max’g … Whats the fix now? VJ commented on Aug 3 Greg0658, “I’ve said this before, I’ll say again, cause I still believe it” The wonderful thing about beliefs is that it allows one to hold faith in something without having to substantiate it. :] “The Clinton boom years were both these factors – China building a factory base with our machinery and the American consumers buying all the cheaply produced product.” Your chronology is off by an administration, otherwise, how would you account for the more than 22 million net new jobs created, the majority paying a higher wage than the average wage in the national economy, and the largest national workforce in decades ? . 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