Wednesday, April 30, 2008

Economy Economy Economy

Here's a good link to the BBC business news page online for today:
BBC - Business April 30,2008

Some Key Points:
  • US economic growth for Q1 = 0.6%
This is a natural consequence of the economic cycle .... there has been a sustained boom and everything needs to reset! Contrary to the doomsayers of the MSM reduced economic growth does not equal recession and even real recession means renewal .
  • World economic growth will reduce to forecast 3.6%
The US is not an island (nor is Canada) ! The Global economy is going to adjust in the same manner as the US domestic market. The doomsayers would like us to believe that in our own national limits we can control the effects of global trends! It is not so and attempts to change anything but strengthening fundamentals like keeping taxes and regulatory barriers to a minimum will impair recovery and delay the recovery while damping the strength of that recovery.
  • US House Prices dropping double digits
This is a GOOD thing! Housing prices have been inflated in a false market driven by bad credit policies, speculation and hysteria. The correction in housing values and the slowdown in new construction work hand in hand to temper the price drop... but the drop is necessary to restore balance in the supply and demand for housing. It also means that housing will become more affordable once again.
  • Consumer Demand goes down with reduced consumption
This is also a GOOD thing. Reduced demand pressure means that prices for goods and services can moderate and once again the natural economic balance can be established.
  • Can the US economy be revived?
This is a STUPID question and misleading in the worst way. The Economy will RIGHT itself and the only thing governments can do is stay the hell out of the way. Or GET the hell out of the way where it comes to regulatory and taxation issues that are interfering! This means getting rid of tariffs and stupid regulatory interference as well as unreasonable taxation and subsidies!

Governments CANNOT make an economy work by meddling! And government meddling in the economy ONLY results in economic instability and damage.


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