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Some Runway Left for That Keynesian Multiplier to Take Off….

July 5th, 2010 · 2 Comments · Uncategorized

…but that economic boost had better take effect soon. Checking out the headlines in the economy session of Investor’s Business Daily today didn’t exactly reassure me:

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At this same point in the Reagan presidency, he was in serious trouble. He knew that his version of Keynesian stimulus (tax cuts) needed to provide tangible results soon, or his re-election would be doubtful. Luckily they did (see chart below) and a 25 year secular economic boom resulted. CBO projections indicate the current state of elevated unemployment is also about to turn the corner. The gray areas below indicate the time between Reagan/Obaama inauguration and 532 days into their presidency.

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On a related note, I’ve been playing with the Gallup presidential comparison chart a lot lately, and Obama and Reagan are almost exactly tied in terms of general approval at 532 days in.

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