[At a minimum, this will hit consumers' pocketbooks—and perhaps their confidence. Before Katrina, Goldstein estimated that consumers' annual fuel bills this year would average about $250 more for gasoline and $400 more for home heating oil and natural gas than in 2004. Now he reckons those amounts will go up 30 percent to 75 percent. Costlier energy could adversely affect consumer spending, corporate profits and inflation—or all three.] We could be reaching a tipping point on consumer psychology, especially when people get their home heating bills, ... Those will be big. |
[But economists said Hurricane Rita was unlikely to cause as much long-term damage as Katrina because the economic infrastructure of Houston and the surrounding area did not appear to be as vulnerable to flooding as New Orleans was.] It's hard to envision a scenario, ... where Houston is impacted anywhere near as much as New Orleans. |
[Economists say that as housing markets begin to cool, bankruptcies are likely to increase.] At some point you will get a combination of falling values combined with rising payments on adjustable mortgages, which will result in more bankruptcy, ... For these areas of the country that are enjoying such wonderful conditions right now, it will become much less wonderful a few years down the road. |
[Here again, the business cycle will determine more than the commander in chief in the near term.] There is very little the president can do to stimulate the job market quickly, ... but there is much the president can do to stimulate the job market long-run. |
[The mathematical logic underpinning the plan is already stirring controversy. Hubbard and Friedman are making a huge and controversial macroeconomic bet that deficits don't matter, effectively reversing a decade of policymaking.] This Administration is trying to change the whole intellectual basis for fiscal policy that Alan Greenspan enforced when deficits were large in the early 1990s, ... We got fiscal discipline through the idea that deficits matter. That's been flipped on its head. |
A bunch of problems that we have ahead of us are largely because of these tax cuts. They are very costly and will contribute significantly to budget deficits in the future. |
A lot of things have to come together to make my forecast of a slowing current account deficit come true. |
A month ago the markets would have interpreted getting rid of measured as meaning that a 50 basis point hike was possible. Now the market won't know if it would mean no change, another quarter-point move, or a 50 point hike is next and that's precisely why the Fed should take it out, |
All these statistics reflect the full force of the hurricanes on the broader economy and we will probably have another month of ugly statistics. |
And you know at these kind of prices, there's lots of money to be made. So I'm sure they're gonna work triple overtime to get their facilities up and running again. |
As the memory of the tech bust fades, we seem to be getting better and better job growth. |
At best, people should prepare for no pay increase and no bonus, something they have been getting a lot of. At worst, they should be thinking they may need to change occupations. |
At some point you will get a combination of falling values combined with rising payments on adjustable mortgages, which will result in more bankruptcy. For these areas of the country that are enjoying such wonderful conditions right now, it will become much less wonderful a few years down the road. |
Broadly speaking, the economy is in a pretty good place. But it's no longer obvious what the next step should be. Now it gets a lot more complicated. |
Bush will paint Kerry as being a tax-and-spend liberal and Kerry will paint bush as only providing tax cuts for the rich. |