Sojka's Call

The Republicans have seemingly given up on any kind of leadership on the US economy. Brian Wesbury puts this in perfect perspective. Wesbury is very much sympathetic to policies that promote smaller government and that will reign in spending on entitlement programs. Yet, he argues that the Pubs keep trying to bash the current economy and that jumping on every little negative economic number and ignoring that the US has been in a steady recovery going on now for about four years is hurting their credibility with voters as seen in the last election. The Dems have certainly shown that they are not going to lead on reducing the size of government and it is something that needs to be done. Unless the Pubs are willing to embark on a true strategy of leadership that acknowledges where the economy is at, the US is going to continue to see the discussion dominated by Krugman and his type of economic theory. Hopefully, the Pub leadership like McConnel and Boehner will listen to this adv...

Interesting discussion on Bloomberg. Check out this short video if you can stand watching these guys interrupt each other, especially Pento. Wesbury makes the point no one on this panel disputes that PE ratios are not in the stratosphere. Pento does not think current market strength supports forward PE's (what I got trying to follow the conversation with all the interruptions) and that market conditions are going to finally cut into profits. Other analysts not on this panel ( Hussman, for example ) say the Shiller PE ratio is too high. With everyone believing treasury bonds are in a bubble does that mean they are the best contrary play right now?

An old New England saying is that a farting horse never tires . Could it be true for the economy as well? I was reminded of this saying when reading the article below by First Trust Advisors. Maybe the fits and starts and hiccups the economy is seeing should be seen as good news and we should change our focus. What do you think? The Plow Horse Rolls On Turn on the television, pick up the newspaper, search the Internet and you will find story after story about Greece, JP Morgan, austerity, the labor force, student loans, California, the G-8, or the Facebook IPO.  Just about every bit of the coverage is negative. 

It’s Real Growth, Not Just Sugar  Check out the link above, the data Wesbury presents and his argument about the role of new technology. My intuition says he is right but I have been fooled before.