Confidence Game

So, we learn from the minutes of last month's Federal Reserve Board meeting that the central bankers, more or less by a majority vote, project bad times for the economy through mid-2009:

Participants’ growth projections had a central tendency of -0.2 to 1.1 percent for 2009, 2.3 to 3.2 percent for 2010, and 2.8 to 3.6 percent for 2011, as most participants expected that the near-term weakness in economic activity would continue into next year and that the subsequent recovery would be relatively gradual.

You can take that to the bank .... oops... the trash can. If the FED is telling us mid-2009, you ought to be hunkering down for a whole lot longer than that. Remember, the Treasury Department is spending nearly a trillion dollars just to build your "confidence."

What's a little press release added to that?

Dept. of Amplification
11-20 am

Dean Baker reminds us that economic forecasters just like the FED guys, above, are the ones "who somehow managed to overlook the massive housing bubble." Be wary of bankers and economists selling confidence games.