The Obama administration’s approach to the economy is stale and failing. In other words, it’s time for a new approach considering that bad news is actually good news.
With low interest rates and and trickle down from the stock market being the only drivers of the economy, a lot is riding on the second gross domestic product report this week.
If these revised numbers look good, then this will translate to the reduction of bond-buying by the Federal Reserve.
What this tapering effect when it comes to bond-buying will do is cause the stock market to fall which will, in turn, work against the wealth effect and the trickle-down that the stock market has produced in recent times.
Of course, an economic crash would mean disaster but with Washington not helping Wall Street, the result could be just as bad.
Which puts Democrats in an unenviable position where no trickle-down economics is probably worse than trickle-down economics.
What makes matters worse is that there is no top-line growth almost anywhere in the country with Wall Street recently reporting a drop in durable goods orders by 7.3 percent in July, and which is almost double the estimated drop.
With that said, it isn’t surprising that the current GDP is only 40% of what was promised during the re-election campaign.
Probably one way to shake things up is by electing someone new for the position of the Federal Reserve chairman.
Does it always have to be an economic theoretician or an academic?
Why not David Smick? The author of “The World is Curved”, and who is now considered to be one of the finest economists out there.
Or even Jack Welch, the CEO of General Electric? Or even Jack Taylor or Ken Chenault?
Maybe it’s time for the President to look past the fact that they are Republicans but no matter what: it’s time for a new approach.