Why are Vermonters, and the Rest of the Nation, in Such A Funk?

There are many reasons for it, but one major one is that the economy is in a period of transition.  The Dallas Fed explains.

First, global imbalances that built up during the late 1990s and early years of this decade now need to be stabilized or unwound. This process will impose sacrifices on U.S. consumers.

Second, it has become apparent that certain financial innovations that seemed to better match borrowers and lenders resulted, instead, in a mispricing of risk and excessive home building. Legacies of this mispricing include financial distress and a weakened banking system.

Third, strong overseas growth has put upward pressure on the relative prices of raw industrial materials and basic consumer goods. These price changes are forcing us to re-evaluate how we conduct our businesses and live our lives.

Read the whole thing.  It's short.

I have another complementary explanation.  It's that newspapers are losing circulation and losing ad revenue.  Journalists are feeling the pressure. No one wants to be employed in a declining industry.  Journalists report bad economic news and see layoffs and cost cutting measures all around them in their papers and in the community of journalists.  They generalize from this, or at least this environment is in the background of what they write.  Hence, the economic situation looks particularly gloomy to them.

Comments

[Green Mtn Punter]

The polls are showing deep seated fear and anger among the working folks of this country instead of a desire to undertake more academic exercises. And yet the MSM keeps telling us that Democrats are way ahead in this race, both Presidential and Congress, yes these same folks who brought us this emerging fiasco by stopping our domestic energy production. I just don't get it- when will the people finally wake up and vote the bums out en masse?

If economists want to perform a useful academic exercise, they should model the U.S. economy and energy costs since 1973 using the assumption that domestic production of oil and coal was expanded beginning in the mid-1970's, as recommended by many at the time, chiefly Republicans. End result? Compare the two scenarios and see what the majority party has cost this economy in energy and other associated costs. My hypothesis is that the expanded production model would show gasoline and heating oil prices at less than the $4 gas and $5 heating oil we are up against now.

[G. Cross]

Damn, this is a site with interesting thinkers, well self- identified "thinkers." Since 1968 we had four years of Carter as President and 8 years of Clinton, a total of 12 years under a Democratic president. The other 28 years have all been under a Republican President. Yet all the problems of the country have been caused by the Democrats. How does anyone come to this conclusion? Oh, I know, the Democrats are always the problem! Good thinking!!