"Krap Out" Kunstler Blows 5th Dow Meltdown Call

Interesting news from Mark Perry at Carpe Diem today: the ECRI Weekly Leading Index, a U.S. future economic growth gauge, rose to its highest level in 26 years, suggesting economic recovery could be its strongest since the early '80s recession.

Mark Perry has been consistently predicting, since the beginning of the year, the current recession would bottom out around mid- to late-summer. Factoring in improvements in the housing market, the Dow's accession above 9,000, China's prelude to promising growth and Europe's recent revitalization, it seems safe to say - even a few months early - that James Kunstler has officially blown his 5th Dow Jones meltdown call.

Aside from prophesying a crash of 4,000 for this year, "Kaptain Krappy" has also made these fabulous Dow forecasts:

• Predicted the Dow cratering to 4,000 in 2005,
  


• 2006,
  


• 2007.

And in his most Joe Montana-like effort ever, James predicted a thousand-point drop during Thanksgiving week of '07. The Dow jumped up 1,000. Did I write Joe Montana? I should have wrote Dr. Wirth=)

Now naturally, this recession has been brutal, and we're not quite out of the woods yet. But for peakers to make comparisons to the Great Depression seems absurd. For a contrast of the two downturns, let's consider...

The Great Depression:

• Number of bank failures: 9,000.
  


• Unemployment peak: 25%.
  


• GDP losses in first three years: -8.6%, -6.4% and -13%.

Versus the current recession:

• Peak unemployment: 9.5% (so far).
  


• # of bank failures: 109 (the S&L Crisis experienced nearly 3,000).
  


• GDP of last, this and next year: -1.3%, -2.0% (projected), +2.2% (projected).

Also, has anyone seen this natural phenomenon?

I heard a while back that James is writing a sequel to his most recent book, "World Made by Hand." Judging from how his and the peakers' fame has swirled down the toilet recently, it may be more suitable for James to hide in a dark corner, and remorsely fiddle "World Stroked by Hand."

- Brewskie

Added: The federal government's spendthrift policies are scary, yes, but for those concerned about drowning in an ocean of inflation, check out another excellent post by Mark Perry. Accompanied by promising graphs.