I was wondering if we're going to see the four-year election cycle low (due in 2010) this go 'round. Usually, presidents load discretionary funds into the year before election, and the Fed tends to goose things for the election. Meaning, of course, that the whole system is least stimulated two years either side of the presidential election. That's when the Fed gets its job done, and when the Prez is busy holding back spending to throw at re-election. I'm wondering if it will produce the low this time. It would come in about 18-20 months. The question would be if Obama has any room to hold back spending in 2009-10, and if the Fed would actually exhibit any restraint whatsoever for several years to come. If not, the cycle may not be so significant.
In years past, that cycle has been huge. And n*4+2 years that it was averted by excessive stimulus, really bad things happened. The 1986 low was "avoided" and look what happened a year later. The 1998 low was printed over, and we got tech collapse a couple years later. The 2006 low was papered over and, well, you get the idea. Dunno if you'd fold that into your E-wave musings or not, but I was trying to.
`BC |
