The reason the markets are diving By Ezra Klein

[sasha031]

Washington likes to talk about the economy in terms of things it can control. Spending and deficits. Stimulus. Policy uncertainty.But the Dow Jones isn’t diving because spending has risen, deficits have grown or stimulus policy has changed. It’s diving because of forces Washington can’t control, and in many cases, doesn’t understand very well. How many members of Congress do you think could give a coherent account of what has happened to oil or steel prices over the last three years? Or what’s happening in the Eurozone? Or to the yuan?

A dramatic gap has opened between the economy as Washington sees it -- and wants to intervene in it -- and the economy that actually exists. Whatever weak recovery we might have hoped for is being hindered by global commodity prices, consumer deleveraging, fears of flagging demand in emerging markets, earthquakes in Asia, and much more. Globally, it’s been an almost uninterrupted run of crises and bad luck. Meanwhile, Washington just spent two months arguing over whether it would pay its bills or spark an unnecessary financial crisis.

Last week, Congress resolved that question. This week, the markets are tanking. Which suggests that Washington is asking itself the wrong question.The right question is simple enough to pose: Where will the recovery come from? The problem is that no one has an answer. And as one hopeful hypothesis after another is dashed, the markets are beginning to panic.
http://www.democraticunderground.com/discuss/duboard.php?az=post&forum=439

[tosh]

1. Link check, please?

[gkhouston]

2. Should be this, I think...

http://www.washingtonpost.com/blogs/ezra-klein/post/the-reason-the-markets-are-diving/2011/07/11/gIQA1ScWuI_blog.html?hpid=z1

[WCGreen]

7. I love the deer in the headlight on the faces of these Masters of the Universe....

Crack me right up...

[jwirr]

3. The problem is that they (government and business) think they can

solve this mess without 99% of the people being involved. That is us. They look at the stock market and think they know what is happening. Well they are right if all they want to know about is the top 1-2% of the people. As long as they think they can ignore the plight of the rest of us they will have no answers. The economy is like an eco-system, totally dependent on each other. Kill off the middle class or the poor (low income workers) or even the rich and the system is damaged. I think that is the thing that FDR understood. We all matter.

[DCBob]

4. investors simply do not see anything positive in the near term...

austerity does not inspire investors.

[n2doc]

5. plz redo your link n/t

[girl gone mad]

6. He's wrong.

People have been offering real solutions for years now, but Ezra consistently ignores them and promotes compromise and third way policies. Now he wants to pretend no one has any answers? lol.

[sabrina 1]

8. Ezra Klein is a DLCer.

Never understood what he had to offer. He's been wrong more often than he's been right.

You are correct, he is a 'Third Way' advocate and we see what those policies have done to this country and the Global Effect he neglects to state, started right here with the very policies he advocates.

[sasha031]

9. thank you, I did not know he was one of Third Way advocates

I continue to learn on DU, will not post his material on this board again.

[sabrina 1]

10. No, it's okay, we need to know what is going on and

he is getting a lot of attention these days, which means his ideas are being taken seriously by those in power. He's not as radical as some, but even before I knew about the Third Way, I always found myself disagreeing with him about things. And I didn't want to, because he was a Democrat. Now though, all those conflicting feelings about Democrats who seemed to be doing and saying things that made no sense from a Democratic pov, are not so puzzling anymore.

Better to know what all sides are saying, so don't apologize. :-)