For the Weekend...

Weekend Reading: Trump's Chief Economic Advisor David Malpass Back in 2008!

Live from the Republicans' Self-Made Gehenna: Who is more ignorant and less well-informed about how the economy works than Niall "Trump-Clinton is 50-50" Ferguson? Yes! It's newly-announced Trump chief economic advisor David Malpass!

David Malpass: Don't Panic About the Credit Market:

Equity markets have recently lost over $2 trillion in the U.S. and even more globally...

...many times the likely amount of mortgage and corporate debt losses in the foreseeable future. This is in part a correction from the sharp global equity run-up through mid-July. Current prices still signal growth ahead.... Buyers in both housing and debt markets are using the market discontinuity to claw prices and terms back to Earth.... According to the bears: As goes the credit market, so goes the economy. Fortunately, Main Street is not that fickle. Housing and debt markets are not that big a part of the U.S. economy, or of job creation. It's more likely the economy is sturdy and will grow solidly in coming months, and perhaps years....

Reservoirs of global liquidity are full to overflowing.... Unemployment rates are falling all around the world, while China's equities have continued hitting new highs. Yet the hyperventilation over the coming U.S. economic slowdown matches the aftermath of Hurricane Katrina.... U.S. growth has endured other waves of equally loud pessimism--over high gasoline prices, low (pre-revision) estimates of job growth, a supposedly negative personal savings rate.... The housing- and debt-market corrections will probably add to the length of the U.S. economic expansion....

Neither the economy nor job growth has been dependent on housing.... Concerns about high inventories of unsold homes are exaggerated.... Nor has consumer spending been dependent on "cashing in" on the housing boom.... In the long list of worries about consumption, the threat of mortgage-rate resets is providing the latest fixation. It shouldn't.... The constant warnings of a housing-related collapse in domestic consumption overstates the importance of housing in the economy...

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