NYC Letter: Trust Team Barry, Part IX -- Baseless Optimism, The Last Refuge

Day 884 of CHOPE

Was it only yesterday, mere hours ago -- our post is still warm -- that the Fed forecast a pick up in the economy while simultaneously downgrading its assessment of the economy?

FED DOWNGRADES ECONOMIC ASSESSMENT,
SEES PICKUP
June 22, 2011 (Reuters)

That's a pretty confusing proposition.

ECONOMIC TROUBLE PUZZLES FED CHIEF, TOO

WASHINGTON June 23, 2011 (ABC News/AP) - The economy's continuing struggles aren't just confounding ordinary Americans. They've also stumped the head of the Federal Reserve.

That explains so much. No. Really. Without a defensible positive forecast, a confounded Fed just wished up a better economy. [Pause.] Soon.

Fed Chairman Ben Bernanke told reporters Wednesday that the central bank had been caught off guard by recent signs of deterioration in the economy. And he said the troubles could continue into next year.

"We don't have a precise read on why this slower pace of growth is persisting," Bernanke said. He said the weak housing market and problems in the banking system might be "more persistent than we thought."

It was the Fed chief's most explicit warning yet that the economy will face serious challenges next year. For several months, he had said the factors working against economic growth appeared to be "transitory."

... The Fed's statement Wednesday stood in contrast to the Fed's more upbeat view when officials last met, eight weeks ago. At that time, the central bank said the job market was gradually improving.

Since then, the economic news has been gloomy. The government reported that the economy grew at an annual rate of only 1.8 percent in the first three months of the year. It isn't expected to grow much faster in the current quarter. The economy added 54,000 jobs in May, far fewer than in the previous two months. Consumer spending has weakened, too.

Somewhere in all that the Fed divined "growth should pick up soon". [Pwn3d!] This is what a $14.7T economy driven by a community organizer looks like.

ARE WE THERE YET? SOON.
Of Course We're Lying

We own the economy.

Debbie Wasserman Schultz (D-FL, 20th),
DNC chair and proud owner of the Obama economy
WASHINGTON June 15, 2011 (Politico)

CHOPE.

You're not the only one confused.