Thursday, January 17, 2008

Random Notes on the Economy|Part 1

Interesting words from our Fed chairman atStocks Fall After Fed Speech. Seems strange that someone from the Fed is talking about Macroeconomics in the short term to the Legislatures. Not that I do not think that the Federal Government should not be involved in such short term Macroeconomics, but just a little surprising.

For a more complete report on these issues let me turn to:Bernanke backs fiscal stimulus if quick.
Bernanke said that while fiscal stimulus measures could help give the economy a boost, it was essential not to compromise longer-term budget discipline. He also warned there was a danger in moving too slowly.

"Stimulus that comes too late will not help support economic activity in the near term, and it could be actively destabilizing if it comes at a time when growth is already improving," he said, adding it should also be "explicitly temporary."
Being somewhat of a Keynesian Economist, I would have to agree with his analysis 100%.

This article does show some slowdown in one segment of the market Housing starts plunge 14% to 16-year low in Dec. But in reality this might be good thing to slowly reduce the buildup of total housing units so that the slump in total housing sales will adversely affect overall housing prices over the short term.

Tax Break Aimed at New Mortgages

U.S. weekly initial jobless claims fall 15,000 to 322,000



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