Wednesday, October 08, 2008


Larry Kudlow cannot be a happy man these days. The guy had literally branded his macroeconomic outlook on every episode of his show in 2006 and 2007: Goldilocks. That was where the economy would slow slightly from the unsustainable recent growth (not too hot) but it wouldn't decline either (not too cold).

From his post on the Corner from July, 2007, entitled "Triumphant Goldilocks" four months before the top:

What we are witnessing here, in virtually every corner of the globe, is the success and the spread of unbridled free market capitalism. It is a dynamic worldwide march toward lower tax rates, deregulation, and, as market strategist Don Luskin put it on last night’s show, the “interconnectedness” of global economies through free trade, the free flow of capital, and the robust free exchange of information.

Do not bother asking him if unbridled free market capitalism should now take the blame. It's good enough that a majority of voters seem to.

Anyway, getting back to Goldilocks, the worse things got, the more he started personalizing her, insisting that "she" would pull through after annotating a chart showing whatever happened to be the least-damning set of economic data he could find.

Well it's clear enough now she didn't pull through. The bears ate her, and it wasn't pretty. But Larry's still putting on a brave face, waiting until they find the body (which of course they won't) before he admits she's not coming back. He's talking about his cautious optimism, just above a CNBC-imposed Wall St. Crisis: Is Your Money Safe? logo with a radioactive orange glow.

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