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Originally Posted by dippin
The fact that you insist on focusing solely on 1893, the fact that you somehow fail to understand the point of how that recession was ended by a gold rush, and the fact that you think my point has anything to do with government intervention ending that recession all point to the fruitlessness of continuing this discussion with you.
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"solely"???
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Because if you think that a recession that was cut short by an exogenous event provides the example of how to act, then we have nothing to do except pray for a big giant comet made of diamonds to fall out of the sky.
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No. What we need is the next "big thing" or the next combination of "little things" to spark consumer spending. Consumer spending was up last month.
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U.S. retail sales unexpectedly rose in January, opening the year with a broad-based increase that marked the first advance in seven months.
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Retail Sales Rose 1% in January - WSJ.com
Business inventories dropped in December, meaning adjustments are filtering through the system.
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Inventories at U.S. businesses fell more than forecast in December and the most since 2001 as companies responded to slumping sales that reflect a deepening recession.
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Bloomberg.com: News
Auto manufacturers are saying they are seeing sales stabalize.
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Auto industry executives are seeing signs that the nation's automobile industry is beginning to stabilize after months of free-falling sales that have threatened the viability of some of the biggest players.
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Ford, GM executives see auto sales stabilizing - Los Angeles Times
But, who am I to point these little tidbits of information out. Our President sees things getting a lot worse, and if not for spending close to a trillion dollars, the world as we know it will come to an end and we will forever be in a shrinking economy.
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There is a reason why every responsible conservative economist supports fiscal stimulus, even if they disagree about the make up of the fiscal stimulus. They might support fiscal stimulus mostly through tax cuts, but even they support these tax coming from deficit spending.
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A tax cut is very different than spending in my view. Tax cuts have a demonstrated record of having a positive affect on economic growth.
Also, to be clear my position is not that the government should not spend money. In some cases there is a need for money to be spent by the government. The problem I have is with the pretense that the "stimulus bill" is mostly designed to spur economic growth, that is simply not true. The bill is mostly a spending bill. Obama's goal is to "save or create 4 million jobs", and to do it he wants to spend $800 billion. Doing the math that is $200,000 per job. If I had $800 billion could could promise a lot more than 4 million jobs. If you got a 10% annual return on $800 billion you could create 1.6 million jobs paying $50,000 per year on that 10% return alone. then if you actually have those people do something productive you could apply that Keynesian multiplier your favorite economist love so much.