It's All Your Fault

The L.A. Times has a cover article devoted to explaining how we will be responsible if the economy tanks. Consumers' free-spending ways face obstacles breaks down some of the numbers that have been crunching working people while speculating wildly about where the economy is going, mostly trying to say that things should be fine.

The real zinger is at the end of the article:

"Predicting a recession is pretty simple. Since consumer spending is 70% of the economy, if we become cautious and close our wallets, then we go into a recession,"

So, economic crises are not the stuff of speculation and over-production. The housing market bubble, which was fueled not simply by sub-prime mortgages but by high-end residential investments, won't have anything to do with it. The higher prices people are paying for food because that industry has found an opportunity to gouge working people with the excuse of ethanol won't be at fault. It will be because silly people get nervous and spend their money on food ...

Wal-Mart said its customers were spending more on lower-margin items such as food and less on clothes and other higher-margin goods.

Don't worry, Congress is already hard at work trying to make sure that hedge fund managers don't get hurt by our fickle buying habits.