Because GM and Dell shutting down their factories and putting around 32,000 workers out of jobs is a good thing. Because 3 airlines (Aloha, ATA, Skybus) going bankrupt within the past week indicates economic growth. Because the banks projecting 200,000 layoffs in the financial sector will boost our economy. Because record high oil, energy, and food prices will add to your economic power. Because American having a negative savings rate will turn the economy around.
Feel free to ignore all the market fundamentals, all of which point towards a deep recession or even a depression. Everything will be fine by the end of the year thanks to the Invisible Hand of the free market. There is no crisis, consume away.
So why is there now a government proposal for using public funds to demolish newly built, partially completed, and foreclosed homes in order to "put a floor" under housing prices (which are the root cause of this whole mess) by destroying supply? If the economy is going to turn around on its own just fine, then why would the government need to entertain such drastic measures? Why has the Federal Reserve Bank handed out around $400 billion in loans to financial institutions along with cutting interest rates in half? Why all the drastic actions, some of which have not been used since the Great Depression if we're just having a minor economic hiccup? Oh, and why is the FDIC on a hiring spree for its Resolutions and Receiverships division? Wonder what they know that the public is not being told.
