AT&T's fourth-quarter earnings results show why policymakers have to spend less time focusing on short-term moves in the capital markets and more on economic fundamentals.

The company said it will increase capital spending by almost $2 billion, or 10 percent, to improve its much-maligned network by adding more cell towers and connecting them to faster fiber optic lines.

I've ranted before about why government spending is necessary to help get us out of recession, but in light of the latest hysteria over the federal deficit, I see no choice but to do so again, even though I claimed only earlier today to want to avoid politics to the extent I can.

Sorry, but that's impossible, not today, when the press and blogosphere are all atwitter over President Obama's gimmicky spending "freeze." So to restate a simple fact, the deficit is being driven by the economy, not the other way around, as the latest report of the Congressional Budget Office makes clear.

This obviously is conspiracy theorizing at its worst, but it's hard not to scratch your head over the revision to the November report on durable goods orders that the Census Bureau quietly made on January 15.

Remember, the initial report of a 0.2 percent increase got major billing as a positive indication for the economy, even though the consensus expectation was for an 0.5 percent increase. As CNBC intoned, this was a sign of "a firmly entrenched economic recovery."

Blaming "administrative" reasons for a weekly jobless claims figure that exceeded forecasts by almost 10 percent seems pretty lame to me.

After all, surely the forecasts could have anticipated some of these "administrative" issues, no? And this is the fourth straight week that the number has risen.

This Bloomberg take on Henry Fordism in China really takes the cake for mistaking the forest for the trees, if you'll pardon the woefully mixed metaphor.

First of all, the article breezily implies that a doubling in wages would promptly get Chinese consumption up to the point where the country can take over from the US as the engine of the global economy. But as we've pointed before, such a scenario would be historically unprecedented, however much appreciated by China's trading partners.

Now that we're all sobering up from our holiday eggnog, it's time to think more about the economic recovery that many of us expect to start to take hold this year.

I've already become convinced that it will largely be a jobless one.

That means managers will have to get more out of their existing workers if production is going to pick up.

Of course, what we're finding is that those that have survived layoffs still aren't that enthralled by their work. You can only recite the "at least I have a job" mantra so many times before it loses much of its motivational power.

Indeed, a report released Tuesday, based on a survey of 5,000 U.S. households conducted for The Conference Board by TNS, found only 45 percent of those surveyed say they are satisfied with their jobs, down from 61 percent in 1987, the first year in which the survey was conducted.

The results of this study by the International Monetary Fund would be funny if they weren't so scary: The more risk financial firms take, the more they spend lobbying against regulation, the study finds.

Using detailed information on lobbying and mortgage lending activities, the authors found that lenders lobbying more on issues related to mortgage lending have higher loan-to-income ratios, securitize more intensively, and have faster growing portfolios.

It pretty much goes without saying that no one will have a hard time saying goodbye to the current decade, but a couple of recent posts at Econbrowser really drive home the point in economic terms.

Now if only the Pollyannas in the press and on Wall Street would take a serious look at this, maybe we could stop pretending the economy is heading for a decent recovery any time soon.

I wasn't sure what to make of some of the rumblings in the blogosphere over the disclosure on Christmas Eve that the Treasury had extended fresh capital to Fannie Mae and Freddie Mac.

Interesting timing, for sure. The Treasury clearly wanted to minimize the bad press that would attend the news. But the timing only got the tin foil atop the heads of the more advanced theorists flashing away big time.

This won't please those who reflexively hate government spending, but a couple of reports in recent days strongly suggest that the economy is likely to slip back into recession in the second half of next year without more help from Washington.

That's because the effects of the $787 billion stimulus package enacted earlier this year are about to wear off. And as the chart here shows, that is about all that's keeping GDP in positive territory at present.