{"id":20552,"date":"2016-05-14T08:03:45","date_gmt":"2016-05-14T13:03:45","guid":{"rendered":"http:\/\/olduvai.ca\/?p=20552"},"modified":"2016-05-14T08:04:08","modified_gmt":"2016-05-14T13:04:08","slug":"more-frogs-boiling-why-trillion-dollar-deficits-are-coming-back-soon","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=20552","title":{"rendered":"More Frogs Boiling\u2014\u2013Why Trillion Dollar Deficits Are Coming Back Soon"},"content":{"rendered":"
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More Frogs Boiling\u2014\u2013Why Trillion Dollar Deficits Are Coming Back Soon<\/a><\/h3>\n

Yesterday I noted that the frogs of Wall Street\u00a0linger in the boiling pot because they are under the delusion that\u00a0stocks are\u00a0cheap based\u00a0on the sell-side hockey sticks that always show $135 per share of S&P earnings and a 15X multiple in the next year ahead. Besides that,\u00a0should anything go awry with the economy, Washington purportedly stands ready to bail-out the stock market with a new round of fiscal stimulus after the election.<\/p>\n<\/header>\n

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The latter delusion brings to mind what might be called the \u201cCBO hockey stick\u201d, which is a fiscal fantasy so unhinged from reality as to make the Wall Street stock analysts\u00a0look like models of sobriety by comparison. To wit, CBO\u2019s latest 10-year budget\u00a0projection assumes that the US economy will hit full employment next year, and remain there with nary a bump or recession in sight\u00a0through September 2026, at least.<\/p>\n

Well, now. Don\u2019t bother to say Rosy Scenario move over because the arithmetic of\u00a0CBO\u2019s fantasy speaks for itself. That is, it is advising Washington to relax\u2014\u2014we are\u00a0heading for\u00a0207 straight\u00a0months\u00a0<\/strong><\/em>without a recession. And not in the next world, but this.<\/p>\n

\"Average<\/a><\/p>\n

Since that\u2019s\u00a0roughly double the longest expansion on record<\/strong>\u00a0<\/em>its worthwhile to recall\u00a0what\u2019s changed since that one-of-a-kind expansion started in March 1991.\u00a0For starters, the\u00a0China export tsunami had not even\u00a0commenced. Nor had the US economy been hollowed out by the massive off-shoring of breadwinner jobs that has resulted from the Fed\u2019s bubble finance policies of the last two decades.<\/p>\n

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Thus, what had been nearly 25 million goods-producing jobs at the start of the 119 month-long 1990s expansion\u00a0has been reduced to\u00a0only 19.5 million today.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

More Frogs Boiling\u2014\u2013Why Trillion Dollar Deficits Are Coming Back Soon Yesterday I noted that the frogs of Wall Street\u00a0linger in the boiling pot because they are under the delusion that\u00a0stocks are\u00a0cheap based\u00a0on the sell-side hockey sticks that always show $135 per share of S&P earnings and a 15X multiple in the next year ahead. Besides […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1654,5979,2120,3575,827,860,865],"class_list":["post-20552","post","type-post","status-publish","format-standard","hentry","category-economics","tag-congressional-budget-office","tag-contracorner","tag-david-stockman","tag-deficit-spending","tag-united-states","tag-wall-street","tag-washington"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/20552","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=20552"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/20552\/revisions"}],"predecessor-version":[{"id":20554,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/20552\/revisions\/20554"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=20552"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=20552"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=20552"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}