Well, along with what I'd consider to be a pathetically inadequate excuse for a "Wall Street reform" bill that was just steamrolled through our deeply captured U.S. Senate, Baseline Scenario's Simon Johnson's recent comments along with Krugman's column in today's NYT pretty much sums it up for me.
"Hope is not a plan."
If you're going to read one piece about our economy this week, IMHO, it should be this from Krugman: "Lost Decade Looming?"
So much for the "recovery." So much for that which is passed off as statistical fact by wannabee economists throughout the blogosphere--that which is so widely embraced by so many, even here. Statistics may be presented like words...however the presenter wishes them to be.
Much talk is made of Obama the consensus builder, but when it comes to our economy, what exactly is a "consensus" all about? A consensus of the status quo? A consensus of thieves? Say it! (It is what it is.)
You cannot spin this. (But, of course, many will try.)
From Simon Johnson on the result of all of the bloviating on financial regulatory reform...
...The consensus on President Barack Obama is that he seeks consensus. He's always been a centrist, we are told by his many biographers, so it is no surprise -- they say -- that he hews to the center on issues like financial reform.
--SNIP--
There is just one fly in this ointment. In the current Senate debate about reforming the financial system, the push for stronger measures has come largely from the center -- not from any radical wing.
But this is not the center that Obama claims. Obama's moderation is quite conservative on finance -- i.e., stick with the devil you know...
--SNIP--
But the biggest banks have simply proved too powerful to overcome without sustained and intense counterlobbying by the White House.
A moderate reformist president could have taken, and held, the center ground by putting greater limits on any future damage that our biggest banks can cause.
But, for whatever reason, this is not what Obama chose to do. He presumably had his reasons. But they have nothing to do with being a centrist in general.
As a result, the financial system could well remain largely as it was before September 2008. Perhaps the megabanks will be slightly constrained in their activities; most likely not -- at least for Goldman, JPMorgan Chase and Morgan Stanley.
Prepare now for new extremes.
So, after all the bullshit, all the bloviating, whaddaya' got? What is the result?
Krugman tells us about the most likely "new extremes" as he spells out the real meaning of the "new normal" for us, today...
Lost Decade Looming?
By PAUL KRUGMAN
New York Times
May 21, 2010
...what about near-record unemployment, with long-term unemployment worse than at any time since the 1930s? What about the fact that the employment gains of the past few months, although welcome, have, so far, brought back fewer than 500,000 of the more than 8 million jobs lost in the wake of the financial crisis? Hey, worrying about the unemployed is just so 2009.
But the truth is that policy makers aren't doing too much; they're doing too little. Recent data don't suggest that America is heading for a Greece-style collapse of investor confidence. Instead, they suggest that we may be heading for a Japan-style lost decade, trapped in a prolonged era of high unemployment and slow growth...
--SNIP--
....there are also warning signs at home, most recently Wednesday's report on consumer prices, which showed a key measure of inflation falling below 1 percent, bringing it to a 44-year low.
This isn't really surprising: you expect inflation to fall in the face of mass unemployment and excess capacity. But it is nonetheless really bad news. Low inflation, or worse yet deflation, tends to perpetuate an economic slump...
--SNIP--
So what we should really be asking right now isn't whether we're about to turn into Greece. We should, instead, be asking what we're doing to avoid turning Japanese. And the answer is, nothing.
--SNIP--
...Will the worst happen? Not necessarily....But hope is not a plan.
Bold type is diarist's emphasis.
Flame away...