Tuesday, October 16, 2007

Horse's mouth and another part of a horse

Slate's Mickey Kaus --

it seemed clear the MSM [mainstream media] was hyping the [subprime mortgage]crisis because a) it was the story of the moment; b) economic news is always bad news; and c) the anti-Bush, anti-GOP press is now in permanent campaign mode--and the economy is one of the few things the Republicans, and Bush's policies, might be able to take some credit for. If it tanks, they're really dead. So the press has a catastrophist bias when it comes to the economy. Remember when Enron was going to sink it in 2002? However big the subprime problem is, it was never going to be as big as the press makes out.

George Bush's Treasury Secretary Henry Paulson, this morning --

The ongoing housing correction is not ending as quickly as it might have appeared late last year.

And it now looks like it will continue to adversely impact our economy, our capital markets, and many homeowners for some time yet. Even so, I believe we have a healthy, diversified economy that will continue to grow ... Today, average nationwide home prices are barely up in the year through June, sales of existing single-family homes are down by nearly 25 percent from the peak in 2005, and the inventory of unsold homes has increased to levels last seen in the early 1990s ... Current trends suggest there will be just over 1 million foreclosure starts this year - of which 620,000 are subprime ... In addition to affecting individual homeowners, the housing correction is also having a real impact on our economy. Annual housing starts peaked at an annual rate of almost 2.3 million units in early 2006 before falling off more than 40 percent through August of this year ... But let me be clear, despite strong economic fundamentals, the housing decline is still unfolding and I view it as the most significant current risk to our economy. The longer housing prices remain stagnant or fall, the greater the penalty to our future economic growth.

Kaus does have that unfalsifiable last sentence to get him out, but it does seem as if the MSM anti-Bush conspiracy has even penetrated the Treasury Department.

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