On Hard Landings

Billmon has a new post up titled Hard Landing. I've quoted the first section below.

But, diving a little beneath the statistical surface, I can see that the trends I've been writing about recently -- most particularly, the deflationary effects of below-trend GDP growth, and the explosion in the U.S. trade deficit -- remain in place. Until those two trends turn around, or at least stabilize, it's difficult to see how a "normal" economic recovery can be sustained.

That's not to say an economic bounce can't happen. Given the amount of stimulus -- fiscal and monetary -- that's been rammed down the economy's throat right recently, it bloody well should bounce. It should roar like a tiger, as a matter of fact.

And yet, so far, the patient is showing only mild signs of improvement.

The worst part is, this is the most optimistic part of his posting. Then he gets into our current account trade deficit, and the overvalued dollar. By the time he's finished, he sounds like Steve Roach at his most dyspeptic.