First a confession – Henry rarely if ever reads Phillip Adams. But today’s column somehow caught the eye:

“Put simply, Howard aspires to be Robert Menzies and Rudd aspires to be Howard. So here we are with Tweedledum and Tweedledee, a toss-up the electorate seems to find somewhat soothing. It’s not like the stark choice between Mark Latham and Howard. It’s more like a choice between chips and mashed potato. Either way you get a spud”.

Lefties are rarely funny – politics is far too serious for humour for the intellectual heirs of Marx and Lenin.

Newspoll says Rudd is ahead of Howard as preferred Prime Minister. Newspoll has Labor well ahead of Coalition, a result clearly anticipated by a whole series of Morgan polls. The Crikey-Morgan poll released yesterday says Howard could lose his seat of Bennelong, a result that would be almost guaranteed if Steve Waugh stood for Labor. And if the Melbourne rumour is correct that John Brumby will return to Federal politics as Treasurer-elect that would be another strike for the bruvvers.

Henry recently bet a “good bottle of red” that the Coalition will win in November (for reasons given here), but confesses his nerve is shaken. But while the economy stays strong, that will be a powerful force favouring the incumbent. Or will it? Will a strong economy plus a promise from Rudd’s Labor not to rock the boat (and with a proven Treasurer in John Brumby if the rumour becomes fact) encourage the voters to take a chance?

According to this week’s Australian Markets Weekly newsletter, forecasts for both global growth and commodity prices have been significantly upgraded. The NAB’s updated forecasts for China are for a rise of 9.9% during 2007, up from 8.9% previously. For 2008, the NAB has forecasted a growth rate of 9.1%, up from 8.1%. The NAB’s US growth forecast has also been upgraded to 2.7% for 2007, up from 2.4% in December. The outlook for 2008 is also positive, with US economic growth likely to jump by 3%.

This obviously means that commodity prices will be stronger than previously forecast, as this graph indicates.

So while the polls may say that Rudd is leading by a couple lengths, the economy is likely to maintain its “miracle status” well into 2008, and it’s been a long time since we’ve seen a regime change during an economic boom.

Read more at Henry Thornton.