Worth a Thousand Words

The President’s Economic Report, authored by the Council of Economic Advisers but with political objectives in view, was issued a few days ago. I haven’t tried to read it all; it made headlines mostly for its prediction of high unemployment for several years to come. The report included several charts that struck me as important. This one shows job gains and losses, recorded monthly:

The main purpose of the Economic Report is to tell us that the Obama administration is responsible for saving us from a depression, or something close to it. But this chart indicates that job losses bottomed out in January 2009, when President Obama was inaugurated, and were already receding by the time Congress enacted the “stimulus” bill the following month. Even as virtually none of the “stimulus” money was actually being spent, job losses continued to decline. The graph is about to go positive, as long as the government doesn’t do anything overwhelmingly stupid to screw up the economy’s inevitable recovery.
This is the other chart that I found noteworthy. It reflects inflation-adjusted home prices. I didn’t see anything like it in the mid-2000’s; if I had, it would have been obvious to me that the housing bubble was out of control and was about to burst. With hindsight, it is hard to see how this could have eluded anyone in Congress.

It also seems obvious that the run-up in home prices that started in the late 1990s was far outside any historical precedent, and was therefore, in all likelihood, the result of misguided government policies. As was, consequently, the ensuing crash. It would appear that home prices are now about where they should be.