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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: koan who wrote (89239)	10/27/2008 1:12:05 AM
From: Oblomov	5 Recommendations Read Replies (1) \| Respond to of 116555

No, I do not have the correct answer, and have no certainty. This is why I would prescribe "do nothing". The wisest counsel has usually been, "don't just do something, stand there." The fallacy of the government having a plan to respond to an economic crisis is that it knows what to do, or that it can figure out what to do given enough time and a sufficient number of intelligent stewards or brains-trusters. This is the well-intentioned but false idea behind industrial planning, which was fortunately struck down as unconstitutional in the US. Unfortunately the stench of the corpse still pervades Washington. It is also a fallacy that what is needed is "competence" (a favorite center-left nostrum), and that when something bad happens, it is the result of "incompetence" or advisors who simply weren't smart or glib enough. History is replete with examples of the government "doing something" to prevent economic pain, and creating a much bigger mess as a result. For example, consider the "untested ideology" of the past 16 years, one in which the the government pulled strings, juiced credit, and weighted outcomes so that more people would end up "owning" houses. That didn't work out too well, did it? And to correct any misconceptions, this example should suffice to show that the Clinton-Bush era has hardly been a laissez-faire or deregulatory regime. Our rulers are constantly cleaning up the messes they create, and yet the booboisie is told from childhood that, to put it in the vernacular, electing the idiot twin brother of the guy who scammed us will "change" the bad stuff and bring about good stuff. It is a peculiarly American form of gullibility, this admixture of trust and distrust. As HL Mencken said, no one ever went broke by underestimating the taste of the American people.