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The Bleeding Has Stopped—Time for New Wallpaper


Maxed Out Mama, who always looks deep into the data, sees cause for optimism:

If one tried, one could make a case that the economy will continue decent growth in 2010, or one could make the case that the economy would subside once more in the later part of 2010. There are indications both ways. Usually, that is an encouraging sign.

I won't try to make any case. In my view this is somewhat fragile and the final trajectory for 2010 depends most on government policy and fuel prices (which will control a lot about spending power).

Income tax withholdings (WIET) are up compared to this period last year. But, last year was horrible. It appears Main Street is no longer collapsing. That’s the good news.

The bad news is that Main Street is still in a fragile condition:

I think we are going to squeak through if Congress would just get off its butt and approve the unemployment extension. This is urgent. Over two million people will lose their unemployment benefits through April if they don't, and even if they do, some people are now facing another interruption in unemployment benefits, which is not going to help.

Mama is O.K. with increasing the Federal debt if the handouts go to the common folk. But she has no faith that D.C. appreciates that hallmark Keynesian economic principle, and is instead focused on transformation instead of survival:

It is governmental malpractice to be pushing insurance reform before the unemployment extension is approved. But seriously, folks, it is. It doesn't matter what you do at top levels if the money isn't inserted at the ground levels.

So even by it’s own economic theory, the Obama administration is pointed in the wrong direction.

I have completely had it with this administration. I can't be polite about it any more. It's got grandiose delusions or something of the sort. If it were a human being it would be Reverend Jim from Taxi. Nice, but so far out there that things are getting unnecessarily difficult.

Barry means well. He wants to save us. Even if it kills us.