A colleague of mine named Eric Loken has a company called Criteria Corp. that does employment testing. Eric is a psychometrician, and as a byproduct of their testing data, he and his colleague Josh Millet constructed something called the Hiring Activity Index, which is, in Millet's words, "a measure of how actively our [Criteria Corp's] customers (made up mostly of SMBs of between 10 and 500 employees) are administering pre-employment tests through our system (and presumably, therefore, hiring) . . . the HAI is the percentage of our customers who are actively hiring (administering tests) in a given month."
A few months ago I posted a report showing the Hiring Activity Index bouncing back in early 2009, a finding that Millet interpreted as a sign that the economic climate for small business was improving.
Recently Loken posted this update: 
Loken writes:
We've plotted the initial unemployment claims data (weekly numbers, smoothed over a month) with the monthly Criteria Corp Hiring Activity Index. The trends look similar, and indeed they correlate very well. The correlation is -.79, showing excellent correspondence between the rise and fall of the jobs data and the HIA. Furthermore, when predicting the jobless claims on the basis of the concurrent HAI and the HAI from the two previous months – using a lagged regression model - the multiple R is .93 (Adjusted R2 = .85).
The point is that real time utilization data for an employee assessment service with a modest client base of small and medium sized businesses can provide very good prediction of national trends. We see this as similar to reports earlier this year that Google searches for flu related topics mapped on closely to CDC data for the spread of influenza. That was also an example where a real-time indirect indicator predicted definitive data that would be available later.
P.S. After I posted on this earlier, Millet responded to some potential criticisms of his measure:
There were some interesting comments and questions about the HAI and its potential utility as a leading economic indicator. We [Criteria Corp.] do sell our software on a subscription basis, and someone pointed out that if non-active subscribers didn't renew because of the downturn, this could artifically inflate the HAI because it is based on the percentage of our customer base that is actively doing pre-employment testing in a given month. This is a legitimate point, but I [Millet] will say that while low levels of use are a reason that customers sometimes do not renew, we haven't see non-renewal rates climb much since November, when the HAI dropped by 10 points. It was also suggested that higher numbers of job-seekers may result in applicants for positions that may not have been desirable previously--this is theoretically possible, but I don't see much evidence for it. What is most certainly true is that companies are getting far more applicants per open positon, as I previously blogged about here. However, since the HAI is based on the percentage of companies testing in a month, not the overall volume of tests, this shouldn't influence the HAI unduly, and wouldn't in any case explain the plunge in November and (partial) rebound in February.
69 comments
Dow over 10,000 today!
carry on
Dow 10,000.
Atlas Flexed?
Don't be fooled by this temporary recovery...this thing is still about to crash and burn.
People say learn from history, right?
Well, one of the worst years of the Great Depression was 1933, not 1929. If you equate 2008 with 1929, that means we'll probably see a complete implosion of this economy around 2012.
I'm not really looking forward to it, but to those of us in the know, it's pretty much inevitable, especially with the disastrous economic policies this administration has already enacted and is planning on enacting during BO's first term.
Mule, we avoided the Depression no thanks to the Ayn Rand fantasy novel crowd. Relax.
"but to those of us in the know!"
I feel honored sharing blogging space with someone IN THE KNOW!
Mule, we avoided the Depression no thanks to the Ayn Rand fantasy novel crowd. Relax.
We haven't avoided shit. We've temporarily staved off the inevitable, that's all. The calamitous issues that are at the core of this economy and infect its very soul are far from being corrected.
They will bring this economy to its knees at some point in the next three years. Unfortunately, there will be plenty of pain and suffering, and nothing Obama can do will stop it. If anything, his policies will exacerbate the problem.
I'm sorry this isn't the happy-ending you are wanting to hear, but it's rooted in truth.
Mule's right guys.
Panic.
Run for the hills.
Seriously, you lost all credibility on this site when you used to threatened people on a daily basis with bodily harm. You're obviously an unstable person.
Why should we turn around and believe anything you say now?
Seriously, you lost all credibility on this site when you used to threatened people on a daily basis with bodily harm. You're obviously an unstable person.
I didn't "threaten people on a daily basis." The only thing I did "daily" there for a while was call Nate a 'wanker.' I stopped doing that a long time ago. I did use more bellicose language before and admittedly over-stepped my bounds (and into threatening territory) a couple of times, but I denounce that behavior now and apologize. There were copycats who stole my name and made threats as a parody of me, but I only did that myself a couple of times.
Why should we turn around and believe anything you say now?
As I said, it's not true in the sense that you portray it (although I'm admittedly guilty of doing it a couple of times), but even if it was and assuming I'm a raving lunatic, I've got just as much credibility on economic issues as anyone else that comments here. I'm just as much, if not more, qualified as most of you posters having a graduate degree in economics.
Besides, even a blind squirrel can find a nut now and again...
I have a problem with this one. The Bureau of Labor Statistics publishes an index of diffusion of employment changes which is probably the best single measure of the state of the employment market. The benchmark is 50 which would mean that an equal number of industries are increasing employment as are decreasing employment in 271 private non-farm payroll sectors. It was over 50 as recently as May 2008 and has declined every month since to hit 14.9 in September, a truly disasterous level. (I am using the seasonally unadjusted 12-month table, but all the others are similar, the industrial numbers are even worse at 4.9; see Table B-7, at http://www.bls.gov/webapps/legacy/cesbtab7.htm).
How does this index correlate with the BLS data?
What disastrous economic policies has this administration enacted exactly?
A 9% increase in the national debt isn't going to do that much.
Of course, Mule, Jeff, Bart DePalma and all these other lurking braindead FReeptards get their information and TPs from the Hillybilly Heroin Addict and FOXY: THE PROPAGANDA NUTWORK, so Obama Derangment Syndrome set in months ago.
Courtesy of the best damn editor of clips this side of the Daily Show:
http://www.dailykostv.com/w/002255/
Very nice to see. First time unemployment claims are down. Hiring in small companies is up. The DOW closed over 10,000. Contrary to the dour scary predictions of the Far Right (which were saying, just a month ago, that we'd never get to a DOW of 10,000 again, never ever ever), Obama has completely failed to make the economy collapse - in fact, it's recovering.
Mule made a point that there was a double-dip in the recession of the Great Depression. That second dip was due entirely to the fact that FDR backed off his spending and recovery programs, on the advice of conservative Republicans. Hopefully, Obama will be too smart to do that, and will instead continue the programs and policies that are leading to our recovery today. Perhaps a second big stimulus bill?
@PorridgeGun,
How do you expect to be taken seriously by using names like this in your assault:
lurking braindead FReeptards
...when you follow it up with this drivel?
Hillybilly Heroin Addict and FOXY: THE PROPAGANDA NUTWORK, so Obama Derangment Syndrome set in months ago.
Pardon me for not really knowing what you're accusing me of. Frothing at the mouth with juvenile insults makes you pretty hard to understand.
Then again, you've proven you are a master of mindless drivel with your prior posts and your attacks on anyone to the right of Noam Chomsky...even though you claim to be a "centrist" yourself....if that doesn't deserve a WTF, then I don't know what does.
(which were saying, just a month ago, that we'd never get to a DOW of 10,000 again, never ever ever)
Care to cite where you came across ANYONE who made that particular statement. Or did you just pull that out of your ass? Saying "I saw it in the comments section of a blog somewhere" doesn't count.
Obama has completely failed to make the economy collapse - in fact, it's recovering.
Uh, no, not necessarily. Stocks trending higher isn't necessarily an indicator of economic recovery. Neither are GDP growth or unemployment perfect indicators of economic health, but neither have they shown much (or any) improvement as of yet.
That second dip was due entirely to the fact that FDR backed off his spending and recovery programs, on the advice of conservative Republicans. Hopefully, Obama will be too smart to do that, and will instead continue the programs and policies that are leading to our recovery today. Perhaps a second big stimulus bill?
Revise history much? Hoover was still President through January 1933. The problems the economy faced in 1932-33 were the result of his actions/inactions, not FDR's.
For what its worth, BMW in upstate SC just announced they are in the process of hiring 700 new employees. something must be working
LOL@Mule(Rider?)
Free Republic, FOX, Limbaugh and his ilk have almost identical views to the BNP. If you understood that, you'd get it.
BTW, I've never claimed to be a centrist (if they even exist, they're basically political cowards), I'm a progressive independent. Huge difference.
LOL@Mule(Rider?)
Yeah, It's Mule Rider. I just shortened my name for brevity's sake.
Free Republic, FOX, Limbaugh and his ilk have almost identical views to the BNP. If you understood that, you'd get it.
I guess I didn't because I have no connection to any of those institutions or people. I never visit Free Republic or watch FoxNews, nor do I ever listen to Rush Limbaugh. I had to look up BNP to see what it stood for.
BTW, I've never claimed to be a centrist (if they even exist, they're basically political cowards), I'm a progressive independent. Huge difference.
That's right! An "independent." Hah! More like far left lunatic fringe moonbat. You suck all day on Olbermann's and Jon Stewart's teats, and at the end of the day compalin that even they are too far to the right.
You never denied that you wanted to see conservatives executed/eradicated. Your would-be willful allowance for the genocide of an ideological group says all that needs to be said about you.
Asshole.
@Mule
Hoover was still President through January 1933. The problems the economy faced in 1932-33 were the result of his actions/inactions, not FDR's.
Yes, the Republicans caused the first Great Depression, just as last year they also caused the second. Thank you for the reminder.
And the Democrats brought us out of the first Republican Great Depression, just as they are now bringing us out of this second Republican Great Depression.
It hardly went down with the political causes/effects that you suggest, in which the problems so easily align with one party and the solutions with the other, but you're free to believe whatever you want to, no matter how grounded in truth it is.
You'll see how well we've "recovered" around 2012. I hope were both still around so I can rub your nose in the bullshit you've been spewing.
For a blast from the past, check out this link: Pete Kent somberly informing us back in February that "the stock market is not a precise mirror of the state of economi health it is pretty darn close.". I wonder if he still feels the same way?
If anyone wants to see what this sites resident dittoheads used to think about the revelatory force of the Dow, all you have to do is take a short stroll through the "economy" tag. It's pretty hilarious reading.
If anyone wants to see what this sites resident dittoheads used to think about the revelatory force of the Dow
That better not be in reference to me, because I've consistently and prolifically said that there is little to no connection between economic health and Dow strength. I said that when Bush was President and I say that now with Obama as President.
@Mule
You'll see how well we've "recovered" around 2012. I hope were both still around so I can rub your nose in the bullshit you've been spewing.
Actually, you're not important enough for me to remember in three years that we had this conversation. So I'll say it now - I accept your apology.
The Republicans lost all credibility on the economy when they drive the world off a cliff last year. Their mantra of "deregulation, free market, tax cuts for the wealthy" is no longer fooling anyone. Clearly, Obama's policies are paying off - we no longer need even to pause to dispute matters with the right wingers.
The Republicants do serve one purpose, however. Since they are so obviously wrong on all counts, it's useful to listen to them, so we can give serious consideration to the opposite of what they suggest.
Indeed, the performance of the stock market is not a great indicator of how the economy is doing due to its overall volatility and tendency to react to short-term situations, but it has profound influence in how people view the economy.
When the market does well, investments increase, consumer confidence increases, and the market does better more consistently.
When the market consistently does better, businesses can expand, more loans are given out, and eventually, eventually employment starts to rise.
Of course, this can only work if we curtail irrational exhuberance and careless risk-taking for short term gain.
Last winter, when the market reacted poorly (but temporarily) to the idea of regulating Wall Street (what a shock), conservatives blanketed the airwaves decrying the Obama administration for letting stocks tank, holding onto Wall Street performance as the supreme economic indicator. When it began to recover, suddenly the stock market ceased to matter in terms of long-term economic growth.
So don't look to the DOW topping 10K as a sign of ultimate salvation, but this continued progress certainly bodes well for the economy. If the administration wants to hold onto the long-term recovery, they need to ramp up regulation of Wall Street (as they promised repeatedly to do) and bear with the ensuing short-term fallout for better long-term progress.
That's right! An "independent." Hah! More like far left lunatic fringe moonbat.
Well, I'm progressive in my social views, and have never voted for any of the three mainstream political partys in Britain (Labour, Conservative, Liberal Democrat), so that basically qualifies me as an independent, does it not?
You never denied that you wanted to see conservatives executed/eradicated. Your would-be willful allowance for the genocide of an ideological group says all that needs to be said about you.
You never denied that you molest kittens and anally rape old women.
Actually, you're not important enough for me to remember in three years that we had this conversation. So I'll say it now - I accept your apology.
Don't flatter yourself. You're grasp on things is tenuous at best, so it might be in your best interests to listen to someone (else besides yourself) who has a clue. Maybe not me, but it's clear by your comments (read: talking poitns), that you are living in an echo chamber. You might want to get out of the house every now and again and see how the world works. Trust me, it's not the same as the delusional fools at MSNBC or that wiseass Jon Stewart would have you believe. And it's damn sure not as rosy as the Obama spin machine would have you believe.
The Republicans lost all credibility on the economy when they drive the world off a cliff last year. Their mantra of "deregulation, free market, tax cuts for the wealthy" is no longer fooling anyone.
Ah, there are those talking points I was referring to...I can never hear them enough, that's how refreshing they are. I will concede that many Republicans - be it government leaders or private individuals - were both directly and indirectly responsible for the nosedive in the economy. The problem for you, though, is so were many Democrats and liberals. You just can't admit it.
Clearly, Obama's policies are paying off - we no longer need even to pause to dispute matters with the right wingers.
Huh?! Now there's a WTF statement! I think the 10% that are unemployed (actually it's closer to 18% when you cut through the bs government data) would disagree that Obama's policies are "paying off."
The Republicants do serve one purpose, however. Since they are so obviously wrong on all counts, it's useful to listen to them, so we can give serious consideration to the opposite of what they suggest.
An attempt to be cute, I see. I find it funny your need to deride "Republicans" when I have no allegiance to or love for that party. Of course, as it's probably already obvious, I have little/no love for most Democrats and liberals.
I'm a blend of conservative, centrist, independent, and libertarian...call me an indeconservatarianist. But I'm no Republican. Blame all the problems in the world on them. I could care less. It's no reflection on me, and I know that just kills people like you who love to have a scapegoat they can name by political affiliation. I'm too elusive for that. I'll righty blame them and their party for the evils they've done, which are many, but I'm smart enough to realize the faults of the other one too.
Mule writes:
That better not be in reference to me, because I've consistently and prolifically said that there is little to no connection between economic health and Dow strength.
Well, that may or may not be the case. Unfortunately all your posts from back then got scrubbed off the site because you were behaving like a maniac.
But go ahead and read the threads from early this year: oddly enough you don't find any of the conservative voices saying "well, the Dow doesn't mean anything" back then. They all seemed quite sure that the Dow was a direct measure of Obama's incompetence.
Apparently that was only the case when it moved downward, however.
Excellent points, Jacob. You're entirely correct. The movement of the stock market has to do more with the psychology of the investor class than it does with the real economy. But since it is, indeed, the "investor class", it is a good indicator of whether investors are willing to invest, and that has an indirect effect on job growth.
But ultimately, the real economy is driven by demand, not by investment - which is why tax cuts for the wealthy do almost nothing to help the economy, whereas tax cuts for the poor and middle class do a whale of good.
Similarly, though stock market performance gives an indication of how investors are viewing things, it is really the sense of stability of the middle class that determines whether the economy will grow.
And this is another reason we need health care reform now - it will increase the sense of confidence that the middle class has for the future.
This is also one of the reasons Bush's wars hurt the economy - the constant sense of fear Bush tried to instill as justification for the wars hurt consumer confidence. That's why he kept telling us to "go shopping", and why even that didn't work - he was fighting against his own efforts to make us scared.
So the news today is good, on all fronts - all of the thigns Bush did to hurt the economy are being reversed.
Well, I'm progressive in my social views, and have never voted for any of the three mainstream political partys in Britain (Labour, Conservative, Liberal Democrat), so that basically qualifies me as an independent, does it not?
Okay, fair is fair. By that metric, I'm not a Republican as I've never voted for someone in their party. But people somehow find a way of constantly deriding me as one.
You never denied that you molest kittens and anally rape old women.
I'll say it right now. I don't molest kittens and I don't anally rape old women.
You can't even put into words what I'm asking you to do...because you don't agree with it. You really want to see conservatives around the world exterminated. If not, do this one simple thing. Copy/paste this sentence that I'm going to type for you:
"I do not wish to see the extermination/eradication/elimination/genocide of conservatives in the world. That would be a terrible thing to happen to a group of people."
Do it and I'll leave you alone. Do it not, and I'll believe that you have wishes contrary to those that I typed and that you do hope that there is a genocide of conservatives someday.
LMAO, get a load of this shit!
Today on FOX Propaganda: IS THIS NOW THE "BUSH RECOVERY"?
http://thinkprogress.org/2009/10/14/down-10000-market/
This is what conservatives, neocons and teabaggers watch every day. WOW.
@yoink
They all seemed quite sure that the Dow was a direct measure of Obama's incompetence.
Absolutely they said that. I recall distinctly last spring, the rightwingnuts saying that the DOW continuing to drop was "Obama's crash". I don't see them today calling the growth in the DOW from 6500 to over 10,000 as being "Obama's rally". Another example of right wing hypocrisy.
Shrinkers,
Absolutely you are right that the engine of economic growth will be strong support for the middle class through stimulus, middle class tax cuts, unemployment benefits, and most importantly, health care.
But to the extent that the stock market has an impact (or maybe better said as provokes an impact), it is looking fortuitous.
Jacob, we are completely on the same page, I think.
Jacob, we are completely on the same page, I think.
Why don't the two of you get a room and beat each other off then?
I'd be willing to bet that at least one of you is gay. Not that I'm bashing you for that. Just guessing.
Mule writes:
I'd be willing to bet that at least one of you is gay. Not that I'm bashing you for that. Just guessing.
I'm pretty sure this is the only "gay" thing that has been said in this thread. If two people agreeing with each other about the current economic situation is enough to send you into fantasies about men beating each other off in a hotel room, Mule, it's about time to subscribe to Out magazine and stop hiding your Clay Aiken CDs.
This is an interesting discussion...the segments that stick to the topic. I would appreciate it if all of you would remember that your comments are read by 70 year old grandmothers and 11 year old children. I believe that behaving with respect for one another is one of the foundations of democracy.
I hear that a number of senators are now pushing to revoke the right of insurance companies to avoid antitrust regulations. That's another good sign, both for insurance reform, and for the economy in general.
So, the hiring index is up, and first-time unemployment claims are trending down. These are all good signs for improvement in the employment numbers - many economists would agree that small businesses fuel job growth. It seems to me very likely that the job numbers will be a lot better by this time next year, which also bodes well for the Dem's chances in next year's elections.
I'll say it right now. I don't molest kittens and I don't anally rape old women.
Congrats, you're most likely the first person ever who've felt compelled to deny such a charge. But you still haven't denied that you like to touch little boys.
The comment section of this website is what counts as a “life” for Fifi.
I got a good laugh from him though—“those of us in the know…”
Yeah, like how to “make” $600K+ in the stock market.
On topic…
It is nice to see some positive numbers showing up, although I think we’re at the stage where the data will probably whipsaw for several months before showing a definite upward trend.
As I understand it there is still a fair amount of stimulus money yet unspent, which I take as a hopeful sign.
Still can't muster the strength to deny you'd like to see a genocide of conservatives, I see?
Wow, you really are a disturbing psychopath.
MsMike…
You raise a valid concern, but some questions as well.
If a 70-year-old granny is offended by the language here, certainly she can decide to go elsewhere and never come back. If she saw off-color words certainly it wasn’t the first time this has happened in her 70 years, so I doubt they will cause much harm. Now if she knows all this and continues to visit, well then perhaps she’s just exercising her Constitutional prerogatives, in which case you should probably not be involved.
As for the 11-year-old, what he does or does not see would fall under the control of his parents, wouldn’t it? Did you have a specific 11-year-old in mind? If so then your alarm should be directed to the people that are raising him. That said, I find it hard to believe that any 11-year-old in this day and age hasn’t already seen far worse than the off-color prattle on this website.
Hate to say it, gang, but I kinda agree with Mule. An economic collapse is not out of the question. Although I will say I disagree with which party will be responsible. It's a little more complicated than that.
Unless Obama puts some teeth into his admonition of Wall Street as he is doing with the health insurance industry, there will be no compelling reason not to return to the Gordon Gekko school of Mgt.
And conservative republican capitalists will be more than happy to return to the 'I get mine first; screw all you other suckers' mentality.
...but I kinda agree with Mule.
;;spits coffee all over the computer::
Mule, instead of spending immense time arguing back and forth about juvenile insults, wouldn't your time be better spent actually making those economic argument for which you were given a degree for. I think everyone here would respond a lot better, if instead of spouting of claims to knowledge you actually proved yourself to them. That said as a graduate economics major I would love to hear your insight. Which of the fundamentals of our economy do you see as leading to the destruction of our financial system. Is it the National Debt?
We have had periods in our history where the national debt was much higher as a percentage of GDP have we not? Admittedly there is a cost to running large deficits but there is immense evidence that seems to suggest that not running deficits during times of recession has even greater costs. I'm assuming you were schooled in a freshwater economics program, as you seem to ignore the wealth of evidence that seems to suggest our economy operates in a Keynsian model. You might rebuttal with rational expectation model, which has some fundamental flaws, but I'll allow you to make that argument.
@Davy said...
And conservative republican capitalists will be more than happy to return to the 'I get mine first; screw all you other suckers' mentality.
I agree with you. From the news reports I've heard, so does the Obama administration, which is why they're formulating new investment regulations. It is to be hoped they come up with something with teeth, and soon.
@EducationalEconomist,
I believe in the demise of this country's economy as a direct result of an unprecedented expansion of the monetary base and ensuing funding crisis.
For a quick snapshot of what I'm talking about, see here:
http://www.chartingstocks.net/2009/03/chart-of-the-us-money-supply-1917-2009/
For a more articulate version of why this will lead to economic calamity, I suggest this 06-01-09 article by hedge fund manager, Bill Fleckenstein:
http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/the-next-crisis-has-already-begun.aspx
...as you seem to ignore the wealth of evidence that seems to suggest our economy operates in a Keynsian model.
And judging by your comments, you seem to ignore the wealth of evidence that suggests our economy operates most efficiently and prosperously under a Milton Friedman-Adam Smith model.
Everybody has their point of view. I can't change yours and you can't change mine. For every instance you can point out where central economic planning and collectivist thinking have "succeeded" in either bringing about prosperity or staving off calamity, I can point to the times where it produced inefficient outcomes and/or led to totalitarian abuses.
For every instance you can point out where the free market "failed," I can point out the places it succeeds.
as a small business owner in a traditionally immune to a recession business, we have just experienced our slowest fall in 10 years. we are low census now for the 10th week in a row. I am thinking of firing not hiring.
@Neil Chasan
as a small business owner in a traditionally immune to a recession business, we have just experienced our slowest fall in 10 years. we are low census now for the 10th week in a row. I am thinking of firing not hiring.
There's no question this is the worst recession since the Great Depression. And the same things that led to that disaster - deregulation, an oligarchic kleptocracy, and low tax rates for the upper classes - led to this one.
And the same things that got us out of the last one - assistance to the middle class to encourage demand, a strong jobs program, and strict regulations on the financial sector - will resolve this one.
An extremely important point to make to all those who think the national debt perils the future of the nation—
As EducationalEconomist suggests, there have been many times when the accumulated national debt was at a dizzying percentage of GDP. The first was just after the Revolution, when the Articles of Confederation killed itself because it did not provide a process by which the federal government could collect revenue and thus retire its debts.
The second period, and arguably the worst since we not only had a staggering debt but enormous war damage to absorb, was the American Civil War. And yet the post-war period (it actually started during the war) saw the greatest percentage expansion of the US economy, which more than paid for the debts the war incurred.
Lastly there was the debt run up by the social programs of the New Deal and the expenditures of World War II. Anybody care to guess whose administration saw the greatest debt-to-GDP-ratio after Truman? Dwight Eisenhower, whose debt ratio at the end of his second term has yet to be matched, even by the profligacies of Reagan and Bush II.
We're not Keynesian anyway. We are not free market equilibrium driven and we utilize wage controls. Just sayin'.
Anybody who cites Milton Friedman as the be-all and know-all of economics hasn’t been paying attention. The greatest belief of his regarding markets was that they were self-regulating. Even Alan Greenspan has said that this assumption is completely wrong.
And if your going to talk about Keynes then you really have to mention Harrod, Caldor, Kahn et al.
Pedantry is ugly.
Anybody who cites Milton Friedman as the be-all and know-all of economics hasn’t been paying attention. The greatest belief of his regarding markets was that they were self-regulating. Even Alan Greenspan has said that this assumption is completely wrong.
And anybody who cites Alan Greenspan as an authority really hasn't been paying attention. He could easily be the most to blame for both the 2001 and 2008 market meltdowns, and is almost always included in lists of the top 5, 10, or 25 (in this case in the article from Time below) people most to blame for the crisis.
http://www.time.com/time/specials/packages/article/0,28804,1877351_1877350_1877331,00.html
His unwillingness to enforce actionable lending standards and refusal to adjust interest rates (higher) when the market called for it led to an unnecessary credit bubble that fueled the entire thing.
Don't get preach to me about Friedman and then throw that hack Greenspan in my face. You are really showing your ignorance of what happened!
Since right wing economic theories have led to two (2) worldwinde financial collapses in the last hundred years, I don't think we need to spend much time debating their merit. Just sayin'.
Whatever Bush and Co were doing - and Reagan's policies that led to it - needn't be repeated.
Why did that thing post my email domain instead of my handle (Mule)?
Very strange.
Ahh! It did it again!
Let's try this again.
I think the point about Greenspan was that even he thought Friedman was wrong.
I think the point about Greenspan was that even he thought Friedman was wrong.
And my point was that a guy who missed so badly at enforcing regulations and adjusting the prime lending rate (leading to 2 financial letdowns) has little standing in critiquing another economist.
Alright, I'm back in business!
And my point was that a guy who missed so badly at enforcing regulations and adjusting the prime lending rate (leading to 2 financial letdowns) has little standing in critiquing another economist.
That makes sense. Fits with my point too, that the economic theories which triggered the massive collapse of last year (deregulation, tax cuts for the wealthy, massive military spending, unrestrained "free" markets) are pretty discredited.
Make no mistake, Mule. I still think you're an obtuse asshole.
Rest assured, Davy, I'd kick your ass 5 ways to Friday.
But we're going to drink beer and listen to good Beale Street music when you visit and forget our differences.
WAY OFF TOPIC -
Nate, AVG anti-virus Safe Search is blocking fivethirtyeight.com for some Firefox users this evening. Something to look into....
Mule, I seem to have you confused. Milton Friedman argued that expansionary monetary policy, rather than expansionary fiscal policy could have prevented the great depression. You seem to think that the expansion of the monetary policy is what will bring about our impending doom, but you subscribe to Milton Friedman's philosophy, or is this just an area under which you disagree with his model. In any case, I would encourage you to read people such as Paul Krugman, to at least gain some perspective into salt water economics. I have seen the doomsday analysis of Bill Fleckenstein all to many times, so what you show me is not new. Obviously the monetary policy will lead to some inflation however as it is a counter-cyclical expansion, the inflation will not be unbearable.
Anyone notice that Time's list of 25 people to blame for the financial meltdown does NOT include Barney Frank, who the wingnuts believe is predominantly (if not solely) responsible for the meltdown?
Blogger David said...
"Anyone notice that Time's list of 25 people to blame for the financial meltdown does NOT include Barney Frank, who the wingnuts believe is predominantly (if not solely) responsible for the meltdown?"
Ha. Given Muley's gay-bashing slurs on this thread, I'm surprised he neglected an opportunity to trash Barney Frank.
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