Stan Collender and James Kwak are also on the case.
Personally, I’m not very convinced of the “business confidence” theory of the weak recovery.
I would myself lay much more emphasis on economic factors like: (i) the continuing destruction of American consumer wealth as housing prices deflate; (ii) the burden of rising oil prices; (iii) the collective decision of American consumers to increase their saving by 6 points of personal income – a laudable decision, but one that subtracts a lot of demand from the economy.
But if I were a believer in the business confidence theory, here’s the counter-question I’d put to Michael Barone:
Which is more likely to subtract from business confidence: a lame speech by the president – or a highly credible and sustained threat by the majority party in the House of Representatives to force a default on the debts, contracts, and other obligations of the United States?
Comments, observations and thoughts from two bloggers on applied statistics, higher education and epidemiology. Joseph is an associate professor. Mark is a professional statistician and former math teacher.
Tuesday, June 7, 2011
Uncertainty and default -- another "if you don't post it someone else will"
I'd been meaning to post something about the uncertainty caused by Dodd-Frank and Clinton Era taxes compared with the uncertainty cause by the debt limit showdown, but David Frum beat me to it with a very good post:
Posted by Mark at 5:36 PM
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