Oil and gasoline prices have plunged over the past month, taking away a big Democratic issue. The broad stock averages have had a nice run since Labor Day and are closing in on five-year highs. This rally is a measure of the future economy and business profits, and it signals continued growth as far as the eye can see. And while investors are abandoning the energy sector, consumers are spending -- making the retail stock index one of the hottest plays on Wall Street.

At the same time, inflation indicators such as gold, commodities and energy have been pummeled. Long-term interest rates have dropped quickly from 5.25 percent to 4.6 percent, another sign of diminishing inflation fears. Consequently, the Federal Reserve hasn't touched interest rates at its last two meetings, while many on Wall Street are now betting the next Fed move will be a rate cut, not a hike.

Meanwhile, the monetary base, which measures the Fed's dollar-creating activities, has been flat-lined, with literally zero growth over the past eight months. As Milton Friedman taught us, excess money is the cause of rising inflation. But the Fed is taking care of that problem, which is why forward-looking market indicators (i.e., gold, energy and long-term bond rates) have all dropped significantly. In fact, if you combine the rising stock market with the falling inflation markets, the clear forecast is for non-inflationary growth.

This is just what the doctor ordered -- and another chapter in the greatest story never told.

No, you won't hear Democrats admit that government policies under Bush are working. In fact, the Democrats have stopped even talking about the economy. But most Americans seem to be coming around. A recent Los Angeles Times/Bloomberg poll reveals that 54 percent of Americans believe the economy is doing well. Almost one in three respondents say lower gasoline prices have enabled them to spend more on household items. And while half of those polled say they disapprove of Bush's management of the economy, that number is down from 59 percent at the beginning of August.

The Democrats, without an economic message of their own, are losing their audience. Even their anti-Wal-Mart tirades are falling short, with a majority of Americans saying the retail giant is good for the economy.

Bush is involved in quite a political turnaround. His national-security offensive, buttressed by his strong stance on tax cuts, is working. If he keeps it up -- and there's every reason to think he will -- the GOP Congress may be poised to snatch victory from the jaws of defeat.