They are the minority party, they have just installed a huge new entitlement, which is not yet begun to stabilize. They know that the second half of the entitlement trade is coming. They are protecting their baby as best they can. They make inside deals, at the expense of the economy, to protect their baby.
Expect very bad government policy for some time. I notice the California deficit is back to some $21 billion, a week after the budget deal. Obama intends to let the cuts expire. Look at the yield curve, signaling very long slow tedious growth with inflation, the long end yield jumping out of its range. Oil is threatening $90.
The economy will contract one more time, and this time it might take Congress and the Fed with it. Somebody over in the Obama camp suffers innumeracy.
No comments:
Post a Comment