I’m Stimulated, How about You?

We now have a “stimulus” package (I suspect that the word “stimulus” has been written more in the last year than in all of human history combined), and its impact has been to drop the stock market by 9% in the past week.  The Obama people have gone out of their way to make sure we all understand that the package is not a quick fix, and that we shouldn’t expect overnight miracles.  This is a common – and smart – political tactic, whereby you lower expectations so you can avoid being criticized for not being successful.
The danger is that you lower them so much that you can’t take credit if something goes right.  I believe that’s where we are.  Yesterday Geithner, et al made the rounds telling us that if we saw job losses decline from 500,000 a week to 250,000 a week, that would be an indication that the package was working.  Sorry, let me do the math here.  There are 300 million people in the US.  Of that number about 150 million are or could be expected to be in the workforce.  Over the past year more than 5 million people applied for unemployment, which is a huge number.  And now we are told that if we start losing only a million jobs a month, we should view that as a success.  Low expectations indeed.
Basic epidemiology shows us that the most susceptible people contract a disease first, then the general population gets it in explosive numbers, then the disease kills everyone it can and the numbers tail off.  Unemployment expansion follows this precise pattern, as business sheds most of the jobs that were marginal in the first place, then the numbers tail off as business tries to hold onto those workers it has to have to survive.  In other words, we’re in the midst of reporting the huge boom of unemployment that epidemiology predicts, and unless the disease is a universal killer – and no disease ever has been, thank Heaven – the numbers HAVE to tail off.  Which the Obama Administration will duly take credit for.  Be educated on this.  Doing nothing would have produced precisely the same result, only faster.

In the short run, there is nothing – not one thing – in this bill that will make a significant impact to anyone that doesn’t work for the government, or have the government as its chief source of revenue.  The markets noticed.

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