This is the Cato Daily Podcast for Thursday, January 17th, 2008.

I'm Caleb Brown.

With the less than stellar news about the sagging dollar, a credit crunch, high oil prices, and

creeping unemployment, it's not hard to see how the R word might sneak into the discussion.

Cato Institute Senior Fellow Alan Reynolds provides his perspective.

Normally when you're looking at recession you'd look at something tangible

not not and you'd look forward not

past rising commodity prices I'm shorting oil I'm shorting gold in other words I'm

betting they go down and and I've made some money doing that.

A falling dollar, I'm long the dollar, and it's been going up, more than it's been going down since I did that ended last year.

And since when do those necessarily tell you anything? Well, rising oil prices do.

And it turns out I wrote a piece recently in the Financial Times, reminding

them that the Financial Times had said I was the first prominent economist to use the

R word in the last recession, January 2001.

And then the obvious question is, why am I not joining that chorus today?

And I said, well, it goes down to an old debate between two academic economists,

James Hamilton now at the University of California,

San Diego, and a young guy named Ben Bernanke,

who was then at Princeton is now charged to the Fed. Well, Hamilton said. and so of oil prices. And the only exception was 1960. And that's still true today. That's also true.

You know, that was true of 1990 with the Iraq Invasion, Spiking Oil Prizes. It was true in 2000.

It went from about 12 bucks to 36 bucks and what

Bernanke came back with he said yes but most of those cases the Fed and other

...