Its not minutia. Krugman's statements where both false and misleading. Krugman claimed that growth in CA's spending "was simply a matter of keeping up with the population and inflation," when real per capita spending was growing at 13.4%. Krugman asserted that "Salon.com has learned Bush is being bribed by the energy industry to delay on global warming." Krugman inisisted that 1 - The economy was not recovering and 2 - That this was do to Bush's tax cuts but -
" A very Bullish Story
In a wall Street Journal Story this morning there is an article entitled “Spending by Corporations May Give Economy a Jolt” an the tone of the headliner story is that…though wary from rallies that never materialized and economic bright spots that quickly faded, economists are beginning to feel more confident: They have raised expectations for third-quarter growth, and say a rebound in corporate profits should prompt companies to finally boost capital spending and investment. "All through the downturn I've felt that all that we have seen are false starts. But for the first time, I have to say, I think we're headed into the real thing," said Allen Sinai, chief global economist at Decision Economics in New York. The average forecast of the 54 economists who participated in The Wall Street Journal Online's economic survey this month put growth for the current quarter at an inflation-adjusted annualized rate of 3.6%, up from the 3.5% average forecast in a survey conducted in June. Expectations for acceleration in growth late this year and early next year were unchanged. They indicated that 1,336 companies included in the Dow Jones Total Market Index that had posted second-quarter earnings as of Wednesday this week reported combined net income of $115.87 billion, up from $74.12 billion last year. And an overwhelming 92% of economists in the survey said they believe the rise in profits will prompt companies to boost capital spending and investment in the next six months. Such investment will be KEY to sustaining a meaningful recovery. But while the improved outlook would give hope to unemployed workers, economists caution that companies will be reluctant to expand payrolls for some time."Companies will wait until the last moment to rehire workers," said Stephen Gallagher, chief U.S. economist at Société Générale. "They're taking on temporary employees now to deal with increased demand, and will keep doing that. But they won't commit to hiring permanent employees until there is no doubt that the recovery will be sustained."
(Unfortunatly the survey requires a Wall Street journal account to access.)
Also see
musil.blogspot.com |
