President Bush spoke to the nation last night. He said the great city of New Orleans will rise again. Work has already begun to rebuild the Gulf Coast region and the federal government will fund "the great majority of costs" for repairing roads, bridges, schools, hospitals and other public facilities. Mr. Bush also cited more things that the federal government would do. Cost estimates of $200 billion have been bandied about to complete these tasks. Given the government's track record, my guess is that the final figure will be more, much more. Who will pay these costs?

Three weeks ago, Dr. Alan Greenspan, Chairman of the Federal Reserve Board and the man in charge of maintaining monetary stability, said the bloated trade and budget deficits threaten the long-term health of the U.S. economy. Little did he know the federal budget deficit was about to explode.

Both Mr. Bush and Dr. Greenspan need to step up to the plate here. I'm strongly in favor of rebuilding the Gulf Coast, but Mr. Bush has busted the budget by allowing Congress to spend money with reckless abandon. The tales of pork and fat in the recently signed $286.4 billion highway bill, which includes 6,371 pet projects and the $14.5 billion energy bill which rewards energy companies that are already making record profits and does little to relieve America from foreign suppliers, are nauseating. Mr. Bush needs to ask Congress to revisit these bills.

Dr. Greenspan has a different, but equally important, problem. He has a policy meeting coming up on Tuesday, September 20th, in which he needs to decide whether or not to raise interest rates for the twelfth consecutive time. If he's really concerned about the health of the U.S. economy, he would not raise interest rates now. The affects of hurricane Katrina on the economy are just beginning to unfold and evidence of the slowing effects of high gasoline prices on consumer spending have just started to appear. The risks of crippling the economy are too high. Indeed, Dr. Greenspan should be lowering interest rates, not raising them.

Mr. Bush, it's easy to spend other people's money. Dr. Greenspan, get out of the rut. We don't need another recession. What we need are leaders who can make courageous, Bold Moves.

ROUGH LANDING.
I've been wondering who in the world has been buying those crummy airline stocks like Delta and Northwest. I got my answer today in the Wall Street Journal. Apparently some clever hedge fund managers have been betting against the odds on the direction of oil prices and other matters. They got burned when both Delta and Northwest went into bankruptcy.

Take a look at the average RV, RS, RT and VST values for the Transportation (Airlines) Industry Group. All are below 1.00. Ugh. Look at the graphs of Delta and Northwest. Both have been losing altitude since last December. Now they have hit ground zero with a Rough Landing.