July 18, 2005

A “Mary Poppins Economy”? Zheesh

Filed under: Economy — Tom @ 6:30 am

Okay, the economic news has generally been pretty good:

Industrial production, helped by a jump in utility output, surged in June at the fastest pace in 16 months, providing the strongest evidence yet that U.S. manufacturing is rebounding.

Meanwhile, wholesale prices were flat last month, matching the benign performance turned in by consumer prices during June.

Taken together, the two reports Friday helped to ease fears that manufacturing, hardest hit in the 2001 recession, was in danger of faltering again or that inflation, battered by high energy prices, was threatening to get out of hand.

And yes, the fact that the economic news is mostly good is why you aren’t hearing about it at the top of the hour on the radio, seeing it on the nightly news, or seeing it on the front pages of the Newspapers of Record.

Having said that, it’s not time to break out the irrational exuberance (fourth paragraph):

“This is about as close as you can get to a Mary Poppins economy–practically perfect in every way,” said David Wyss, chief economist at Standard & Poor’s in New York.

Somebody needs to check and see whether that’s really sugar they are using to help the medicine, er, coffee go down in the Econ Group at S&P.

For what it’s worth, BizzyBlog remains concerned, as does this columnist, about the level of risk home lenders and borrowers are taking, and about the possible impact of the draconian bankruptcy law that will take effect in three months. But on balance, I would say that things, while not too shabby, certainly aren’t supercalifragilisticexpialidocious.
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Background: The history behind the term “irrational exuberance.”
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Useless fact: Someone tell Mr. Wyss that in the movie, the song “‘Practically Perfect’ was intended to introduce Mary Poppins. But instead the melody of the piece was used for ‘Sister Suffragette’ (used to introduce Mrs. Winifred Banks)”.
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UPDATE: For the pessimistic view, Paul Farrell (link requires free registration) identifies 20 bubbly reasons why there are storm clouds on the horizon.

UPDATE 2: Official Outside the Beltway Traffic Jam and Jawa Fatwa Festival participant.

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3 Comments

  1. And that Nodometer on the left panel portends of storm clouds on the horizon.

    Comment by Porkopolis — July 18, 2005 @ 1:12 pm

  2. Excellent point, Porkopolis. Can’t believe I didn’t mention it. Must have had my head up the chim-chimeny.

    Comment by TBlumer — July 18, 2005 @ 1:23 pm

  3. [...] ver wise to say such things, no matter how much you want to believe it. I think I am with Bizzy Blog on this one. While it’s good to hear someone in the press actually saying something positive re [...]

    Pingback by The Anchoress » “Practically perfect in every way…” — July 18, 2005 @ 10:04 pm

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