Saying "I told you so" isn't helpful

But it's just hard to stop! This is exactly what we were trying to tell everyone:

But ever since the 2001 recession, we haven’t really had growth in incomes. Instead, we’ve had asset-led growth. People who owned stuff already in 2001 saw the value of that stuff go up. Since they were now “richer” they were able to borrow more. And since they were able to borrow more, they were able to get more stuff. That had a similar result as if their incomes had gone up and they’d used the income to buy more stuff. But it was unsustainable. The lending based on higher asset values was based on the idea that the assets would keep going up in value. And the increase in value was driven by a combination of speculation, and buy the fact that consumption was creating economic activity. But now it’s all collapsed.

That's Salmon, via Yglesais, reiterating what everyone needed be hearing circa 2001 to 2006.

Wingnut Econ through the years

So, as of Tuesday's close, the Dow is lower than on the day George Bush took office in 2001.

I doubt any of our conservative interlocutors from 2004-5 are still reading this blog, but just in case any of them are, I'd like to go into the wayback machine and recall that, throughout the Bush presidency these folks made the claim that Bush had turned the economy around through his two-pronged approach of tax cuts and prayer.

Liberals argued that the ballyhooed recovery, such as it was, was only benefiting the Americans whose personal fortunes put them at the very top end of the economic scale. And, more to the current point, we pointed out that recovery wasn't based on strong fundamentals, but instead was a phantasmal recovery based on a fairly disturbing housing bubble.

Wingnut economists and bloggers, while occasionally acknowledging the housing bubble, refused to believe that this was the engine of their pseudo-recovery. And here we are, when the whole thing has predictably melted down, the market is back where we started, and things are looking grim. And the wingnut response?

Yep, you got it. Blame Democrats for the housing bubble.