"The worst economy since Herbert Hoover"

The Economist (June 4) weighs in on current interest rates.

"Can bond yields fall further? ... Think the unthinkable: America's long-term interest rates may be heading down, not up. ... Are rates low and curves flat because inflation has been broadly tamed? Is it because economic activity is expected to slump? Or has the link between growth and inflation been changed in some more or less permanent fashion, so that faster growth can take place with slower inflation than in the past?"

One can go on. Is the available capital growing faster than the available (perceived) investment opportunities? Will more money flow into housing? Will the "housing bubble" continue to expand? Will house price appreciation continue to fuel consumption and all the rest?

The flat-yield-curve-predicts-recession literature that we all grew up with did not include the housing appreciation-economic growth link.

Why are there economic fluctuations? My favorite undergrad textbook asks: "why not?" In this tumult, it's nice when things continue to go right. Last year's loosers cited, "[t]he worst economy since Herbert Hoover." Did the people who came up with this stuff sell their homes?