I challenged President Bush's overly optimistic statement on the "economic slowdown" previously
. Unfortunately, it is increasingly looking like I was right, but also worse than I thought.
From the UK Telegraph:The Federal Reserve's rescue has failed
By Ambrose Evans-Pritchard, International Business Editor
Last Updated: 12:39am GMT 04/03/2008
Page 1 of 2
The verdict is in. The Fed's emergency rate cuts in January have failed to halt the downward spiral towards a full-blown debt deflation. Much more drastic action will be needed. [...]
I am not sure what "drastic action" it will be. Every time the Fed drops the interest rate, inflation rises.
Upcoming presidential candidates, especially the Democrats, have all sorts of plans to raise taxes to fund social programs. Wanna see the economy tank? Just raise taxes. It will exacerbate this weak economy and put yet more people in the poorhouse.
Many people will try to blame President Bush for the economic downturn, but that is not the case. Bringing the troops home would not have prevented this. The only thing that would have prevented this is the banks not getting greedy and lending money to people that could never afford to pay it back.
This was a case of a fouled business cycle, risky business practices, and shameless consumerism. We need to let it fail, painful though that may be. We will recover, but not if the government interferes by election year pandering. The United States has weathered some serious economic downturns before. We'll come out of this, too.
The point is that none of us have much money in our pockets these days and the government knows only how to take what little we do have. Your salvation is not going to come from the government, unless they (they? us versus them?
) cut your tax rate on both local and federal levels. More money in YOUR pocket is the only way you are going to be able to pay for your home, food, gas, and shoes. You buying stuff is what makes the economy tick. Until you can do that, the economy will be a long time in recovering.