Subject: The "Bush Boom"
A lot of news lately about how well
the "Bush Boom" is going and how well it compares to the
"Reagan Recovery"! In an
article by Gregory Robb on cbs.marketwatch.com
he quotes Ian
Shepherdson, U.S. economist at High
Frequency Economics.
"This is all about a long period of very low
interest rates, which have done their job well."
Let me give another quote. This one from the
Federal Reserve Board
"Changes in the federal funds rate trigger
a chain of events that affect other short-term interest rates,
foreign exchange rates, long-term interest
rates, the amount of money and credit, and, ultimately, a range
of economic variables, including employment,
output, and prices of goods and services."
(Raise the rates and the economy slows.
And lowering the rate has a positive effect on the economy that
is much greater than giving millions
to your rich campaign contritbutors!)
I remember the "Reagan Recovery". As
soon as "Raygun" took office the Fed Fund Rates dropped
like a rock, just like they did after
the "Dubya Coup". And they both followed Democrats, who who
couldn't buy a break from the Fed.
I smell a RAT(R)
Clinton was able to forestall the inevitable
for 7 years by lowering the deficit and paying down the national debt
and even buying back the 30 year T-Bills.
The economy was better than it had been in generations. However the
Federal Reserve will win out! In spite
of the fact that unemployment was at a 30 year low and inflation had fallen
to 1.6% the Feds continued to raise
the Fed Fund Rates. During the last months of Clinton's administration
the
economy finally started to buckle.
And now the 'end game'. Install in the
White House a 'Mortimer Snerd' or a 'Raygun' or a 'Dubya', steal from
the poor and give to the rich with a
tax cut and drop the Rates from 6.5% to 1%. With those interest rates the
economy has to improve. When it does
the 'Fat Cats' pay their tiths to the reelection committee, pocket the
rest
and tell the world that 'Mortimer' is
the best President this country ever had and name an airport or a bridge
or
a sanitarium after him.
For those who must see the numbers, here they are:
Look at the "Effective Fed Fund Rates" ("EFFR")at the begining and end of Carter/Reagan and Clinton/Bush:
When Carter took office 01/1977 the "EFFR"
was 4.61%
When Carter left office 01/1981 the
"EFFR" was 19.08% (An increase of 14.47%)
Reagan took office that same month so
the "EFFR" was 19.08%
At the end of his first term (01/1985)
the "EFFR" was 8.35% (A decrease of 10.73%)
With a bounce like that any fool could
have a recovery and he did.
Well if it worked once and Democrats
are afraid to say anything they are
sure to do it again.
When Clinton took office 01/1993 the
"EFFR" was 3.02%
At the end of Clinton's second term
(01/2001) the "EFFR" was 5.98% (An increase of 2.97%)
(Actually we should use the 12/2000 rate of
6.40%. Greenspan was so anxious to turn the economy around for
Bush that on 01/03/2001 he issued a
1/2 point reduction before Bush could even get moved into the White House.)
When Dubya took office 01/2001 the "EFFR"
was 5.98% (After the 1/2 point "gift" from Greenspan.)
The "EFFR" is currently 1.01% for a
reduction of 4.97%
and the Fed are promising to hold the
rates there indefinitely. (only Eisenhower(R) had lower rates)
With a bounce like that any fool could
have a recovery and he is.
Wait a minute. Am I saying that the Federal
Reserve Board would manipulate the economy for political reasons?
Cause millions to lose their jobs? Cause
the loss of billions (if not trillions) of dollars in personal wealth just
to
make a C-Grade actor and a reconditioned
cokehead look like they had a clue about economics?
You dammed right I am!
And to add insult to injury Bush claims
"I INHERITED A RECESSION!".
What really hurts though, is the 9 candidates
failure to point out that he inherited it from Greenspan.
Well, its not unusual for a Republican
to have a recession. Using the economist's rule of thumb that a recession
is at
least 2 consecutive quarters of decline in real GDP there have been
eight recessions in the last 50 years.
Presidents with recessions:
| Eisenhower(R) | 1953 4Q |
| Eisenhower(R) | 1958 1Q |
| Nixon(R) | 1970 1Q |
| Ford(R) | 1974 4Q |
| Carter(D) | 1980 3Q |
| Reagan(R) | 1982 1Q |
| Bush41(R) | 1990 4Q |
| Bush42(R) | 2001 2Q |
EIGHT recessions and SEVEN were during
Republican Administrations.
Every Republican since Eisenhower has
had a recession!!!
Must be a profit motive in there somewhere.
Some folks have been deluded into thinking
that Democrats get the economy so hot that inflation runs
wild and the Fed has to raise interest
rates to cool it down.
Nothing could be further from the truth!
There have been 13 full Presidential
terms since 1951, look at the 6 with the highest percent of increase
in the C.P.I. over their 4 year term
and the direction that the Feds took the Fed Fund Rates during that time.
Presidents with the highest inflation:
| Carter(D)* | 48.72% | UP 14.47% |
| Nixon/Ford(R)2nd term* | 37.32% | DOWN 01.33% |
| Reagan(R)1st term* | 21.26% | DOWN 10.73% |
| Nixon(R)1st term* | 19.66% | DOWN 00.36% |
| Bush41(R)* | 17.75% | DOWN 06.10% |
| Reagan(R)2nd term | 14.79% | UP 00.77% |
(*)There was a recession during these terms.
Of the 6 Presidents with the highest
inflation over their term, 5 were Republicans!
Must be a profit motive in there somewhere.
Click Here for more/attribution
Keep your hammer swinging!
Arm Hayseed
"cynic"