Good Economic Times, Bad Mood

News Type: Event — Seeded on Thu Jun 28, 2007 4:19 PM EDT

Article Source: Reason Magazine

business, us, economy, money, jobs, inflation, growth

Unemployment stands at 4.5 percent, down from the peak rate of 6.3 percent four years ago. The stock market is near record levels. Economic growth, which slowed in the first quarter, has since rebounded. Inflation is running below 3 percent

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2.5

{"commentId":821098,"authorDomain":"O-K"}

O-K

Some people react with emotion, not from facts.
The polls suggest that some people won't acknowledge anything good here lest it suggest competence on the part of a president they can't stand. According to a survey by the Pew Research Center for People and the Press, 43 percent of Republicans say the economy is fair or poor, but 79 percent of Democrats take that view. "People are giving partisan responses," says public opinion expert Karlyn Bowman of the American Enterprise Institute in Washington

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1 vote

#1 - Thu Jun 28, 2007 4:21 PM EDT

{"commentId":821383,"authorDomain":"GreyWolf"}

Grey Wolf

The stock market is near record levels...

The earnings of the S&P 500 are up 30% from four years ago, yet the S&P 500 is just now reaching the levels it was at four years ago. The earnings of the average worker has stagnated, while the earnings of the top 10% of the US population have soared.

The author has a very one-sided, shall I say "partisan," view of the US economy, which isn't surprising considering the American Enterprise Institute, who he uses the quote from, has as its members basically all of the same people as the Project for a New American Century (PNAC), the extreme right-wing group (neo-cons) who, for ten years, advocated strongly that we invade a country in the Middle East and build permanent bases to prevent any other country other than the USA from having jurisdiction over the region.

I was actually really interested in reading the article and the author's perspective on the economy, but after reading the article I am very disappointed that it contained no actual analysis of the economy, it is only a political rant worthy of Rush "Limbo" -- and really belongs in the Politics section, not Business. The article is full of emotion and short on facts.

But, yes, psychology is actually very important to the markets; stocks are only worth what people are willing to pay for them -- and war, social strife and political turmoil will leave the S&P 30% undervalued. Analysts estimate that with oil at $70 a barrel at least $20 of that is just pure risk premium -- invading Iraq and destroying their oil production should have only pushed oil to $50, but people charge a premium right now because there might be even less supply tomorrow if, say, the USA invades and/or nukes Iran and all of the Middle East gets involved and the world tilts toward WWIII, the odds of which remain higher as long as the neo-cons hold power in the USA. The moment Bush leaves office oil will quickly retreat and inflation will subside somewhat and the S&P will soar.

(Gee, I should made this comment an article...)

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1 vote

#2 - Thu Jun 28, 2007 5:50 PM EDT

{"commentId":821427,"authorDomain":"O-K"}

O-K

Your comment would make a good article. I saw my seed as somewhat one sided but not extremely so and it was not in depth. I would be interested in comparing his view with an article from you.

{"commentId":821427,"threadId":"119441","contentId":"808197","authorDomain":"O-K"}

1 vote

#2.1 - Thu Jun 28, 2007 6:04 PM EDT

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O-K

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Good Economic Times, Bad Mood

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