Paul Krugman isn't feeling too peppy about the sputtering economy.
By my count we’ve had four adverse surprises lately: GDP, private-sector payrolls, service-sector survey, and new claims for unemployment insurance. Since there seem to be a fair number of Charlie Browns out there — people who keep expecting a housing recovery, even though Lucy keeps pulling away the football — I guess we should add weak housing numbers to the mix.
It looks like a sputter, not a crash, but it’s definitely not good.
The bond market agrees: 10-year rates are back down to 3.17 percent. (S&P? Never heard of them).
The tragedy is that even as the real economy disappoints, yet again, Washington is entirely focused on dire events that aren’t happening: fiscal crisis, runaway inflation, dollar collapse.
Lost decade, here we come.
Somehow, the Republicans, the very serious DC press and the conservadems managed to convince enough Americans that the deficit and the debt -- all of a sudden, even though the debt was barely mentioned for the entirety of the Bush administration -- was the issue. And so correcting the slow recovery is impossible, shy of begging for a miracle.