Bending the Third Rail
Because We Should, We Can, We Do
Saturday, October 28, 2006
Back Breaker?
Weeeee. Feel that economic boom!

It appears that the slowdown is in full force. The next step will be to find out if the landing is soft, hard, or without any landing gear at all (nose first):
Oct. 27 (Bloomberg) -- Economic growth in the U.S. cooled to a 1.6 percent annual rate in July through September, the slowest since early 2003, as housing slumped and the trade deficit widened.

The government's first estimate of the quarter's gross domestic product, the value of all goods and services produced in the U.S., shows growth slowed from a 2.6 percent pace in April through June, the Commerce Department reported today in Washington. A measure of inflation watched by the Fed eased.

Homebuilding declined by the most in 15 years, while the trade deficit widened as an acceleration in personal spending increased demand for foreign-made consumer goods. The fallout for the rest of the economy has been limited, economists said, and recent gains in corporate and consumer spending support the Federal Reserve's outlook for ``moderate'' growth.
Learning that you're not as wealthy as you thought is a very troubling experience for consumers, especially those who make shopping their hobby ... which includes most of the country. I don't think that this slowdown is enough to convince shoppers that they need to stay home and play with all those new gadgets they've purchased in the last few years. At least not yet, especially with speculators trying to pump up the stock market. So I think a softer landing is still possible. But the fundamentals underlying the economy absolutely stink, leading to a conclusion by some that the potential for growth without inflation is dramatically lowered. I also get a little nervous when someone wants us to know that Treasury Secretary Paulson has revived "the plunge team".

It may be up to a Democrat to do a replay from the FDR playbook to clean up the Herbert Hooverian mess that Bush has wrought over the long term.
Written at 12:40 PM by Greyhair.
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