{"id":13275,"date":"2021-05-01T08:28:38","date_gmt":"2021-05-01T15:28:38","guid":{"rendered":"http:\/\/victorhanson.com\/wordpress\/?p=13275"},"modified":"2021-05-01T09:55:49","modified_gmt":"2021-05-01T16:55:49","slug":"eeyores-cabinet-thoughts-on-the-economy","status":"publish","type":"post","link":"https:\/\/victorhanson.com\/wordpress\/eeyores-cabinet-thoughts-on-the-economy\/","title":{"rendered":"Eeyore’s Cabinet: Thoughts on the Economy"},"content":{"rendered":"\n
\"\"<\/figure><\/div>\n\n\n\n

Victor Davis Hanson \/\/ Private Papers<\/p>\n\n\n\n

As I wrote not long ago, I think we can expect a big boom of pent-up demand coming that will result in 5 percent or so of annualized GDP growth, maybe as early in late second or third quarter of 2021 lasting until mid-year next year but accompanied by inflation reaching 4-6 percent. And then at some point, depending on whether the Biden huge tax hike, green deals, and new regulations are in effect, a much higher inflation, slower growth, and recessionary trends in late 2022 or early 2023. So growth\/boom\/inflation\/stagflation\/recession?<\/p>\n\n\n\n

 You say, “So what? That’s the natural order of things”. Perhaps. But an entire generation has come of age without knowledge of anything but de facto zero interest, and little or no inflation, and plentiful jobs. I can attest from 1978-84, that inflation, recession, and unemployment can all exist at the same time. I can remember feeling lucky to have a farm production credit loan at 9% and knowing “delighted” friends who bought homes in 1981 at 10% and a family member who bought a car at 18% and felt he got a good rate. So buckle up…<\/p>\n\n\n\n\n\n\n\n

The general consumer price index went up in March at .6 percent, in just 30 days (if that were to continue, we would have an annualized rate of over 7 percent.) But what really counts are life’s vitals like increases in gasoline (out here it’s up $1 dollar a gallon since the new year), and natural gas heating (5 percent rise). But these measurements lag. Housing has gone up about 20 percent here in California, at least new housing that depends on sky-high lumber. <\/p>\n\n\n\n

So I drove into town again yesterday and did the following: bought gas at $3.97 a gallon; went to Home Depot: there I was stunned to see 4×8 one-inch plywood at over $100 a sheet and 1\/2 inch over $60 (a year ago they were a quarter that or less). I wanted to buy a cheap ratchet set: all sold out, as many things in the tool departments were. All the lumber was either picked over, or so expensive to be left alone (e.g., redwood 2\/4s) or sold out, as paradoxical as that seemed. A family member is looking at a new house. The price from a year ago has gone up by a third. Propane has soared too.<\/p>\n\n\n\n

Labor is short; “now hiring” or “workers wanted” signs are common. In sum, millions, with stimulus money, are re-emerging from their cocoons\u2014rediscovering the joys of eating out, traveling, going somewhere\/anywhere, driving longer than to the supermarket and back, and eager to buy a car or truck, remodel, fix up something\u2014as the somnolent economy retools to accommodate them, but in apprehension faces higher taxes and more regulations. And the Biden response: print more money, dream up more unproductive woke “investment” and run up bigger deficits as if we were back in March 2020 in need of stimuli.<\/p>\n\n\n\n


<\/p>\n","protected":false},"excerpt":{"rendered":"

Victor Davis Hanson \/\/ Private Papers As I wrote not long ago, I think we can expect a big boom of pent-up demand coming that will result in 5 percent or so of annualized GDP growth, maybe as early in late second or third quarter of 2021 lasting until mid-year next year but accompanied by […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_newsletter_tier_id":0,"footnotes":"","jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[1],"tags":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p466Sb-3s7","jetpack_likes_enabled":true,"jetpack-related-posts":[{"id":13548,"url":"https:\/\/victorhanson.com\/wordpress\/historians-corner%ef%bb%bf-assessing-america-in-the-age-of-woke\/","url_meta":{"origin":13275,"position":0},"title":"Historian\u2019s Corner\ufeff: Assessing America in the Age of Woke","author":"Jennifer Hanson","date":"June 15, 2021","format":false,"excerpt":"Victor Davis Hanson \/\/ Private Papers Part One Wokism took off in June 2020. It became institutionalized after Joe Biden became president. We have now had nearly five months of the radical Biden political agenda to seep through the larger popular culture. So where are we now in this suddenly\u2026","rel":"","context":"With 8 comments","block_context":{"text":"With 8 comments","link":"https:\/\/victorhanson.com\/wordpress\/historians-corner%ef%bb%bf-assessing-america-in-the-age-of-woke\/#comments"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/06\/Inflation.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/06\/Inflation.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/06\/Inflation.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/06\/Inflation.jpg?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":12218,"url":"https:\/\/victorhanson.com\/wordpress\/trumps-chances-for-reelection-are-looking-better-and-better\/","url_meta":{"origin":13275,"position":1},"title":"Trump\u2019s Chances for Reelection Are Looking Better and Better","author":"victorhanson","date":"February 27, 2020","format":false,"excerpt":"Victor Davis Hanson \/\/ National Review Donald Trump\u00a0has at least five strong historical arguments for his reelection. One, he is an incumbent. Incumbent presidents have won 14 of 19 reelection bids since 1900. The few who lost did not enjoy positive approval ratings. In a Gallup poll from earlier this\u2026","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":7156,"url":"https:\/\/victorhanson.com\/wordpress\/untruthful-and-untrustworthy-government\/","url_meta":{"origin":13275,"position":2},"title":"Untruthful and Untrustworthy Government","author":"victorhanson","date":"March 27, 2014","format":false,"excerpt":"The massaging of critical data undermines our society. by Victor Davis Hanson \/\/\u00a0National Review Online\u00a0 Transparency and truth are the fuels that run sophisticated civilizations. Without them, the state grinds to a halt. Lack of trust \u2014 not barbarians on the frontier, global warming or cooling, or even epidemics \u2014\u2026","rel":"","context":"In "Political Culture"","block_context":{"text":"Political Culture","link":"https:\/\/victorhanson.com\/wordpress\/ahref=\/index.php\/categories\/angry-reader\/categorylink\/a\/american-culture\/political-culture\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2014\/03\/2619159204_dfe4e2befa-300x295.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":13787,"url":"https:\/\/victorhanson.com\/wordpress\/eeyores-cabinet-cannibalism-suicide-or-what-2\/","url_meta":{"origin":13275,"position":3},"title":"Eeyore\u2019s Cabinet: \u201cCannibalism, Suicide, or What?\u201d","author":"victorhanson","date":"July 25, 2021","format":false,"excerpt":"Image by vinct @ Getty Images Victor Davis Hanson \/\/ Private Papers Part Two Item: For the millions of Americans who lived through inflation and stagflation from 1974-1983, why would we ever wish to return to all that? We more or less avoided both the last forty years by being\u2026","rel":"","context":"With 8 comments","block_context":{"text":"With 8 comments","link":"https:\/\/victorhanson.com\/wordpress\/eeyores-cabinet-cannibalism-suicide-or-what-2\/#comments"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/07\/Cannibalism.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/07\/Cannibalism.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/07\/Cannibalism.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/07\/Cannibalism.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/victorhanson.com\/wordpress\/wp-content\/uploads\/2021\/07\/Cannibalism.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":3931,"url":"https:\/\/victorhanson.com\/wordpress\/the-fragility-of-the-good-life\/","url_meta":{"origin":13275,"position":4},"title":"The Fragility of the Good Life","author":"victorhanson","date":"July 31, 2006","format":false,"excerpt":"by Victor Davis Hanson Tribune Media Services We Americans don't seem to worry that we owe billions of dollars to the Chinese, or that our oil hunger is enriching hostile rogue regimes, or that our annual budget deficit keeps adding to our national debt. Why fret now? For nearly a\u2026","rel":"","context":"In "July 2006"","block_context":{"text":"July 2006","link":"https:\/\/victorhanson.com\/wordpress\/ahref=\/index.php\/categories\/angry-reader\/categorylink\/a\/archives\/2006\/july-2006\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":11876,"url":"https:\/\/victorhanson.com\/wordpress\/we-hold-all-the-cards-in-the-showdown-with-iran\/","url_meta":{"origin":13275,"position":5},"title":"We Hold All the Cards in the Showdown with Iran","author":"victorhanson","date":"June 21, 2019","format":false,"excerpt":"Victor Davis Hanson \/\/ American Greatness In May 2018, the Donald Trump Administration withdrew the United States from the Joint Comprehensive Plan of Action with Iran, popularly known as the Iran nuclear deal. The United States then ramped up sanctions on the Iranian theocracy to try to ensure that it\u2026","rel":"","context":"In "Iran"","block_context":{"text":"Iran","link":"https:\/\/victorhanson.com\/wordpress\/ahref=\/index.php\/categories\/angry-reader\/categorylink\/a\/the-world\/the-middle-east\/iran\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/posts\/13275"}],"collection":[{"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/comments?post=13275"}],"version-history":[{"count":3,"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/posts\/13275\/revisions"}],"predecessor-version":[{"id":13286,"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/posts\/13275\/revisions\/13286"}],"wp:attachment":[{"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/media?parent=13275"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/categories?post=13275"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/victorhanson.com\/wordpress\/wp-json\/wp\/v2\/tags?post=13275"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}