Will the fake Gadfly please stand up?

Two of these haunting faces belong to Marty Aussenberg, the Memphis Flyer “Gadfly.” The third is just a mockery of a mockery.

Is the U.S. headed for an economic slowdown? The Financial Times seems to be expecting one. But Fred Thompson isn’t worried, and AEI’s Kevin Hassett argues the housing bust is just a market correction that isn’t as likely to “spread into the general economy” as the headlines suggest:

The accompanying chart relates real investment in housing by U.S. households to real GDP from 1952 until this year. The chart reveals that housing investment has been volatile throughout the past half-century. By the standards of past booms and busts, the current episode looks tame. By this measure, the boom was not nearly as high as past indiscretions, and the bust has already reversed it.

Here’s the chart:

Since Mr. Hassett hasn’t responded to my email, let me repeat my question here:

Is declining residential investment a fairly reliable predictor of economic recession?

The only exception to that trend seems to be the period of 1966-1967, where there was a sharp decline in housing investment but no recession until the same level was hit a second time in the period of 1970-1971.

If this reading of the data is correct, it would seem to indicate that we are currently headed to a recession. Do I have it wrong?

I find further evidence for this prediction in the October 8 issue of National Review, on the topic of the housing slump and the Fed’s recent action easing monetary policy:

“[P]romoting long-term growth is not something the Fed can do, and therefore not something it should try to do. What it can do is fight inflation. As the editors of the Wall Street Journal have observed, the inflation picture does not justify looser money. Confirming their predictions, the dollar started to fall on the Fed move. If inflation gets out of control, the Fed will have to re-tighten — and at that point we might end up with the recession it is trying to avoid.”

It might be that the housing bust on its own wouldn’t have led to an economic downturn but that the Fed’s resulting action could. It would be pretty incredible if the Fed were responsible for both driving down the dollar and tipping us into a recession simultaneously. Especially if the whole thing would have resolved itself without any intervention.

The weak dollar is already here. Will a recession follow? We shall see.

MEANWHILE: 46% of Americans incorrectly think we’re already in a recession, even as the economy continues to churn along at a brisk 3.9% growth rate.

AND: Larry Kudlow says, “Message to all you worrywarts out there: The U.S. economy remains strong. There is no recession ahead.”

In order to solve a $10 million funding gap, Shelby County Mayor A C Wharton has now endorsed and proposed John Willingham’s idea to tax county workers for the “privilege” of providing us with labor:

Wharton said it would capture those “individuals who come in here who are protected by our police officers, our sheriff’s deputies, who pollute our air and who leave … and then look down their noses at us and say how bad it is in Memphis.”

I wonder what it is these individuals are coming to Shelby County for, other than just to pollute our air and bask in the safety (!) of the Memphis area.

Coming here just to spew exhaust and dial 9-1-1 repeatedly, and then having the audacity to complain about how bad it is, well that’s just insane, and they need to be taxed.

I mean, if they were coming here to provide us with goods and services, that would be another thing altogether.

Oh wait, that is why they come; dang. Ok, forget about that. It’s just that we need the cash:

“And for those who say, ‘Well, you need to be more efficient,’” Wharton said, “I welcome them to come and tell me what they’d like to cut.”

Yeah, Mr. Smarty-pants, coming in here looking down your noses at us, polluting our city and straining our police force. You find a way to balance the budget if you’re such a hot-shot.

I mean, it’s not like we just discovered $3.6 million in waste at the city school system’s Central Nutrition Center, which amounts to more than a third of the budget gap. That kind of outrageous government waste, fraud and corruption simply doesn’t happen in Memphis and Shelby County.

Oh wait, yes it does. Over and over and over again. Well, crap.

MEANWHILE:

One report from county trustee Bob Patterson notes that 120 local companies have tax freezes under PILOT (payment-in-lieu-of-taxes) programs and that some $44 million worth of county property taxes and 372 parcels of land are involved in the programs.

Can you find your favorite conservative blogger in the above photograph?

Actually, that’s just a photoshopped version of the pic that was published in the Commercial Appeal last week.

If I had really appeared in the original photograph, I would have been sitting in that first cubicle in the right corner.

That’s right, dear friends, I was a movie extra last weekend. Rod Lurie’s Nothing But the Truth is being filmed in Memphis, and I was one of several picked to be a “newspaper reporter” for a few scenes that were filmed at the CA building last weekend.

I had a great time observing the film crew as they set up the shots, watching the movie stars do their thing (I got close to Alan Alda, Kate Beckinsale and Angela Basset), chatting with the other extras, and even doing a little bit of acting myself.

But the best part of all is the thought of crashing a film based on Plamegate and imagining the facial expression certain people will have when they find out.

Also, I’ve decided to donate my earnings to the Lewis Libby Legal Defense Trust. ;)

See also:
WaPo: Hollywood Plugs Its Tale of a Leak
TheoGeo: various posts tagged “Nothing But The Truth”
M3mphis: Um, Ms. Beckinsale, you don’t have an extra jacket in your wardrobe, do you?

I’m taking one of my legendary blogging breaks, which usually means I’ve been too busy to write, and certainly not that I’m out of material. These announcements are typically followed by increased blogging activity, but not always. See you soon, I hope.