Watching the Presidential press conference on Friday I should have popped popcorn. It was extremely entertaining. The economy was of course the major theme and I loved watching the President dance around the question of why the O-ministration will not refer to this $50b taxpayer spending spree on infrastructure and proposed $300b in small biz tax incentives as a stimulus, “I have no problem with people saying the president is trying to stimulate growth and jobs. There’s no doubt that everything we’ve been trying to do … is designed to stimulate growth and jobs in the entire economy.”
Hello? It is. Just say the word. You won’t get cooties, I promise.
The unpopularity of the first stimulus is of course the reason why the O-ministration is avoiding the word “stimulus” like the plague. Many of my contacts tell me the similar spending path will only line the pockets of their special interests versus helping Amercians who are out of work and are struggling. Stephen Ross on Squawk Box this morning called America the “land of the unions”. He also added the salaries of the unions have gone up and there is a direct correlation between union salaries and the last stimulus. Those are his words, not mine. But when someone of his status says something like that it makes you think. And there are a lot of reports out there supporting his comments.
Many people think the uncertainty of this economy will be over after the mid-terms. My contacts are telling me that’s not the case. Unlike Y2K where there was fear about what would happen after the computer’s calendars changed to 2000- people planned for the uncertainity. But when the event was over, life went on. There was no more uncertainity. This is no Y2K. On November third our debt will still be sky high, China will continue on its path to over taking us in market cap and the hidden costs in the policies being made in Washington will still be hidden. The fears on inflation or deflation will still be there.
Its going to take a long time to get back on the road to prosperity and this road is covered in potholes. My CEOS and market people tell me the infrastructure plan set before us will not fill those potholes, it might actually create an economic sinkhole.