For the Record
My back-of-the-envelope guess is that we need to unwind something in the area of 10% of GDP in order to hit the bottom of this wave. That's an upper-end estimate, based on the assumption that roughly 100% of the growth seen in the past 2-3 years was based on funny-money of various forms. A cascading credit breakdown will be avoided, if it was ever particularly close to occurring, because no one really wanted it to. China and Japan cannot call in their debts en masse without killing their #1 export market.
Obama will probably win, but not by a landslide, and, like Bill Clinton, he will be leashed with an opposition Congress in 2010. This will happen because the role of prominent Democrats in the mortgage-bubble-bust will become impossible to overlook, and because the Pelosi/Reid caucuses are exceptional in their practical incompetence. The Great Bailout's transmogrification from an Act-to-Save-the-Republic to a "Christmas Tree" bill festooned with favors will become one of the defining moments of their era.
In any event, an Obama administration especially will find itself faced with precious little room to maneuver. An increase in capital gains taxes will not sit well with the nation's seniors, who rely more on dividends and stock sales for income than people below retirement age, and whose portfolios are presently being eviscerated. Whatever money there is will be needed to fill potholes and fix roofs. Bill Clinton was saved from defeat in 1996 by a combination of Gingrich's botched government shutdown and Bob Dole's incompetent campaign, which McCain's looks increasingly likely to reprise.
My back-of-the-envelope guess is that we need to unwind something in the area of 10% of GDP in order to hit the bottom of this wave. That's an upper-end estimate, based on the assumption that roughly 100% of the growth seen in the past 2-3 years was based on funny-money of various forms. A cascading credit breakdown will be avoided, if it was ever particularly close to occurring, because no one really wanted it to. China and Japan cannot call in their debts en masse without killing their #1 export market.
Obama will probably win, but not by a landslide, and, like Bill Clinton, he will be leashed with an opposition Congress in 2010. This will happen because the role of prominent Democrats in the mortgage-bubble-bust will become impossible to overlook, and because the Pelosi/Reid caucuses are exceptional in their practical incompetence. The Great Bailout's transmogrification from an Act-to-Save-the-Republic to a "Christmas Tree" bill festooned with favors will become one of the defining moments of their era.
In any event, an Obama administration especially will find itself faced with precious little room to maneuver. An increase in capital gains taxes will not sit well with the nation's seniors, who rely more on dividends and stock sales for income than people below retirement age, and whose portfolios are presently being eviscerated. Whatever money there is will be needed to fill potholes and fix roofs. Bill Clinton was saved from defeat in 1996 by a combination of Gingrich's botched government shutdown and Bob Dole's incompetent campaign, which McCain's looks increasingly likely to reprise.
posted by The Snob at
9:22 PM
1 Comments
Links to this post
