The economy is not close to a 1970s-style mix of stagnant growth and high inflation, Federal Reserve Chairman Ben S. Bernanke said yesterday, but he painted a generally dour outlook and cautioned that the downturn is likely to cause some small banks to go under.
"I don't anticipate stagflation," Bernanke told the Senate Banking Committee, during his semi-annual report to Congress on monetary policy. Some analysts have become increasingly worried about that possibility after recent high readings on inflation and weak readings on growth. "I don't think we're anywhere near the situation that prevailed in the 1970s," he said.
RLCC: Actually it's worse in many ways.
- The U.S. wasn't anywhere near the debtor nation that it has become.
- People aren't saving anywhere as much as they used to either.
- The solid industrial jobs are all but gone.
- The income gap is vastly wider.
- The politics of openly acceptable corruption is being practiced. This makes the people despondent.
- The people's antiwar sentiments have been so far ignored. This allows the spending on guns while Bush still doesn't call for a cut back on butter.
- The prospects for recovery can only fall back on even lower economic expectations for the working class.
- The rate cuts so far have had little positive impact.
- Prices of basic necessities are going to go through the roof if gasoline prices continue rising and construction keeps on sinking.
- The only thing that will slow fuel costs with a people who don't give a damn about the environment will be consumers cutting back hugely on driving simply because they can't afford to waste gas.
- It is either that or Bush opens up the spigots in Iraq and just for America, which won't help the costly global-pollution problem at all.
Originally from on February 29, 2008, 3:48am