<![CDATA[The Index of Leading Indicators is down for the fifth straight month. Consumer prices are up, and although manufacturing productivity has climbed it hasn’t produced the sustained investment promised in exchange for massive tax cuts. There are plenty of layoffs planned in coming months and the U.S. government has just increased its debt ceiling for the third year in a row, this time by $800 billion.
Consumer spending and consumer debt are up.
Here’s what it all adds up to: The Bush Administration has fueled a short-term increase in economic activity to help its re-election bid with a massive increase in public and private debt, all of which is going to come due. Moreover, if the dollar continues to tank our traditional sources of debt financing and the rising Asian sources of debt financing will be exhausted and, in the case of China, armed to commit economic extortion.
We’ve borrowed all we can against the future, much more than we should have. Any sense of economic comfort you have today is borrowed from our children, who will be justified in their anger when they realize what we’ve done to them.]]>
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Tastes like economic crisis
<![CDATA[The Index of Leading Indicators is down for the fifth straight month. Consumer prices are up, and although manufacturing productivity has climbed it hasn’t produced the sustained investment promised in exchange for massive tax cuts. There are plenty of layoffs planned in coming months and the U.S. government has just increased its debt ceiling for […]