This is a posting on the semantics of whether we’re in a Recession or not and remembering a tune from the 1970s even more applicable today.

 

Who cares? Either way, a Recession or downturn stinks for most of us.

 

But apparently the government is fudging the numbers to keep us thinking it’s not that bad. Investment expert John Mauldin says the government numbers about last month’s slight economic growth don’t add up. In fact, he thinks the economy may have actually dropped in the last two quarters.

 

Special thanks to good friend Bill Bailey for directing me to Mauldin’s site.

 

Yes, I know you’re shocked this Administration might fudge numbers or facts. The lack of candor from this White House is an issue. But that’s not my point here.

 

We don’t need the government to tell us whether we’re in a recession or not. We know it – whatever you want to call it.

 

Ronald Reagan, on the campaign trail in 1980, twisted economic fact into a brilliant campaign speech. He said, “A Recession is when your neighbor loses his job. A

Depression is when you lose your job. And a recovery is when Jimmy Carter loses his job.”

 

Alan Greenspan tells the story in his autobiography. As an economist, he cringed. Yet, he gave Reagan great credit for touching the nerve of the people.

 

No one today, except maybe Barack Obama, is hitting that kind of a nerve with people. The political campaigns and the media are too caught up in the minutia of

economics as compared to solid economic theory.

 

We’re trying to figure out if two quarters with negative GDP is a Recession while folks are losing jobs and health care.

 

I blame the media and the political parties. They should be blowing-up and destroying the silly economic notions on the campaign trail.

 

I don’t know which silly notion is worse. You tell me. The first is this one. Tax breaks should be continued even as we go into further debt and we face a looming

disaster with Social Security and Medicare. My take: Tax breaks are fine if there’s spending cuts and if the tax cuts spur economic growth.

 

The second is the gas tax holiday. That will only spur more demand for gas and raise prices further. Here’s the No BS on gas prices. The liberals and the conservatives are equally at fault. The liberals stop drilling and refineries in America. That reduces supply. The conservatives lobbied and paid off politicians to keep oil and car companies from finding new sources of energy.

 

Remember the 1970s song by Stealer’s Wheel? That’s how I feel. Stuck in the middle with you. In case you’re too fried from the past, the rest of the lyrics are:

 

Clowns to the left of me, jokers to the right,

 

Here I am stuck in the middle with you.

 

But let me give you a little lift.

 

First, there is the theory of creative destruction from Joseph Schumpeter. Frankly, a Recession might be needed to clear out the bad stuff. This downturn has wiped out some lousy mortgage folks.

 

Second, there is a great saying from Dick Hoey, the Senior Economist for BNY Mellon. I used this before, but it bears repeating. Dick told me and a group of folks that a Recession is like a hangover. You tell yourself two false things. One, you think you’re going to die. And two, you can do something right now to make it go away.

 

Hang in there and don’t listen too carefully to the economic garbage on the campaign trail.

 

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