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Originally Posted by dippin
Why, exactly, would he be the next "Herbert Hoover?"
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Perhaps he won't be, I don't know. And I certainly don't want a depression. My basic view is that our economy can not be micro-managed and that attempts to "fix" the economy can do more harm than good. Is Obama so smart that he won't make errors similar to those made in the past? So far the answer seems to be no.
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Herbert Hoover has become what he has become primarily because he believed in a number of principles and economic theories that you actually seem to agree with.
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There is a difference between Hoover's words and his actions. His actions, I would not have supported.
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He was a firm believer in "Ricardian equivalence," or the notion that any fiscal stimulus now will simply become tax hikes in the future, and so a balanced budget was the sound strategy to fight a recession. It is hard to have one's cake and eat it too: one can't simultaneously complain about the size of the stimulus package and then compare Obama to the guy who has become what he has become because he didn't believe in stimulus spending.
Sure, to a degree I actually agree with the comparison, but that is mostly because I believe that Obama's stimulus spending should have been more significant, and that his regulations don't go far enough. But I'd be surprised if you thought the same.
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Regulations need to add value. Banks are not doing what they need to do, because of the fight between them and the administration, it is counter-productive. If Obama mandated they loan money in accordance to normal standard prior to the financial crisis, that type of regulation may have worked. Stimulus targeted to the correct segments of the economy may have worked better than his initial plan. So, yes I can support regulation and stimulus.
---------- Post added at 05:23 PM ---------- Previous post was at 05:18 PM ----------
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Originally Posted by Baraka_Guru
Most economists I've read about are cautiously optimistic about future trending. Most people don't see it because the current positive trends are either future-looking or coincidental factors that most people either overlook or don't see in their everyday lives.
I have yet to hear from an economist that is more than minimally concerned about a double-dip recession. Of course, many of the economists I read about are Canadian. But they do speak about the American economy as well.
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One of the key factors are the assumptions used by those economist. I think given certain conditions many would easily agree there could be a double dip. For example, many say we have not seen the worst of the commercial real-estate market decline. Depending on what happens, that could trigger another "panic" in the financial sector. Many agree that during the past few quarters GDP is artificially high due to inventory build up and government spending, these conditions will not hold true in the up coming quarters and real economic activity has to take up the slack. Absent a real up tick in economic activity, we could easily see a double dip.