Kevin Rudd is pursuing an economic policy agenda inspired by Philippe Starck, so minimal it seems, but it may end up passé if the Wall Street rout witnessed on Friday gains momentum.

In August, there was a body of opinion which believed that the sub prime meltdown and subsequent global financial market uncertainty helped the Liberals. Then Fed Chairman Bernanke cut rates and most political commentators in Australia quickly put away their Idiots Guide to the US derivatives market and forgot about it.

Well, just as the Daily Telegraph pronounced “Johnny’s back” on Friday, global financial market jitters are back and are likely to play a very significant role in this election. Why? The bad news from Wall Street on Friday raises the spectre of not just a US recession but of slowing global growth. That is very bad news for Kevin Rudd, given that he is already tracking 20 plus points behind the Liberals on the issue of economic management.

The US consumer, who accounts for about 17% of global GDP, is no longer the only problem. On Friday a combination of data and commentary from companies such as 3M and Caterpillar highlighted that the problems are spreading to the non-residential construction sector in the US and the rest of the world is beginning to slow.

There are also rumours that there are more big write downs coming from Investment Banks such as Merrill Lynch and given the IMF released a report last week predicting slowing economic growth across the world in 2008, the portents do not look good.

The big problem for Kevin Rudd is that while “me-tooism” with a bit of envy thrown in may work for a tax policy, its limitations will become obvious if the global equity markets enter another significant correction period. It also hands the Liberals a gift.

The Liberals can highlight that they’ve successfully managed the economy through the Asian financial market meltdown in the late 90s and a US recession earlier this decade. Costello can argue that if Kevin Rudd cannot come up with his own tax policy, what will he do if faced with an economic or financial market crisis when he is PM? Call former PM Howard at his Hawks Nest retirement home and ask for a draft outline of what to do – with a half-priced computer thrown in?