Saturday, January 26, 2019

I give an economic prediction

Never do this, don't do what I am doing.

We will see a minor recession caused by a housing correction.  Dean Baker will be correct for the first time in his career, and Paul Krugman will be counter cyclical for the first time in his career. 

The dip happens because we are confused about rates and will let the ten years go above 3%, we have a sudden stop at 3%, it represents a particular percentage of tax payer income that is unsustainable.

The 'accounting plan' the plan that gets us through the boomer transition, is about twenty years of slow growth, the is the 83 yard can kick.  That twenty years will not include the bond rate going above 3%, and the accountants know it, it is in the books.  Any other path is monetary regime change.

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