I was listening this morning to a story on NPR about rising unemployment when an interesting thought struck me. The story was talking about the negative feedback loop of rising unemployment leading to lower housing prices and more economic uncertainty. These factors then dampen consumer spending and keep unemployment high and even encourage more unemployment.
I know it’s a very perverse perspective, but my reaction to that news was that maybe there is an outside chance that our economy will actually undergo the correction that it obviously requires despite the best efforts of Bernanke and Geithner to prevent the necessary correction. If the economy continues to defy the stimulus efforts it may yet reach a solid foundation – but I won’t hold my breath on that.
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