Monday, July 27, 2009

Newsweek Announces the End of the Banana

The Recession is Over, Newsweek declares.

Newsweek is supposed to be a reporter of the news. NBER dates the onset and end of recessions ("bananas"). There was denial from many economists that a recession was on all throughout the first half of 2008. Newsweek may well be correct, but on the other hand, the headline may be literally false. Thus EBR takes this headline more in the contrarian spirit than in the "Glad you told me, guys" vein.

In any case, it hardly matters to most people. The Merchants of Debt retain their primacy in the structure of the economy. That's at least one strike against long-term economic health. Yet it need not be fatal. We will not know tomorrow; it takes a lot longer than that to have a better sense from the perspective of the future where you really are now.

In the meantime, Wall Street is selling newly-created stocks and bonds at a rapid pace as corporate insiders fail to buy the stocks of their own companies. A strange time with many cross-currents . . .

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