02/27/2006: Brigadier General Robert L. Scott (USAF, Ret.), a World War II ace pilot who shot down 22 Japanese “Zeroes”, has died. He was 97.
Every year, the ranks of the Greatest Generation–the generation who fought the Great Depression, the Germans, and the Japanese, and came out victorious–dwindles.
The older I get, the more I appreciate the accomplishments of that generation.
02/27/2006: Just remember: Economists almost never get it right. We shall see in the upcoming months if the reckoning of our debt-on-steroids economy is going to happen this year or another time. I hope this survey is right, but I have my doubts.
Prediction: We will be in recession by year’s end. Whether it pops, or whether the air is let out gradually, the debt balloon is almost maxed out. Consumers have taken on a near-critical mass of debt. The issue is merely whether it will be a hard or soft landing.
Here’s the wild-card: if it become obvious by the Summer that we are in a recession, then there will be major turnover in the House and Senate in November: the Democrats will take back both houses of Congress.
If that happens, the impeachment wheels will begin turning by February 2007.
02/27/2006: New home sales in January plunged 5%. The number of new homes available for sale is at an all-time high.
Could the bubble be bursting? We shall see. However, prices cannot get infinitely high, especially when they have been driven into low-earth orbit by ultra-low interest rates that have fueled excessive borrowing.
An economy that continues to build on debt must either add value commensurate with that debt, or otherwise experience a devaluation of assets (deflation).