[Golden Eagle]

The problem as I understand it is the banks that got the money aren't loaning it out, at least not to small businesses in the US. A lot of them simply bought their own stock, as well as other stocks, causing the unrealistic rebound we've seen in the markets. Per recent reports including on Fox News last night, Obama has sent his henchmen to Wall Street to tell them to loosen up the purse strings on the money, but they all told him forget it, not while he's in office they're not. Which of course is resulting in a lot of demagoguery by the left against big business, to help Obama win the next election anyway. In other words, this problem isn't about to get any better till at least 2012, no matter how much more money is handed out interest free to banks. At least that's the perspective given to Main Street. As for me I'd like to see more State-owned banks, who may care a little more about their citizen's well being than how much money they can make on them, while having to compete with neighboring state banks on all sides.

[Norseman]

>>The problem as I understand it is the banks that got the money aren’t loaning it out, at least not to small businesses in the US.<<

My take on it is completely different. The money supply that I watch has grown at a tremendous clip and we are getting the inflation in commodities and stock prices that one would expect. If banks start to circulate the massive amount of excess reserves they hold, we’ll enter a hyperinflation that will make past South American inflation levels look good to us.

The main reason the economy is struggling is that Washington DC is aggressively regulating businesses across the board in an attempt to get as much done on the green agenda as possible in as short a period of time as possible.

Just look at the jobs actually lost in the Gulf drilling industry, not to mention those not created if sensible policies were in place. How much bigger would the coal industry be with energy prices at this level if we enabled clean coal technology? Instead, we’re aggressively CLOSING coal-fired plants. You could probably question the owners of any business in the U.S. today and find that expansion plans are being subdued by regulators.

Meanwhile, where we are expanding makes little economic sense...windmills and solar and ethanol, in the energy sphere. Sure, shale oil is booming, but liberals would love to stop it, so is it booming as fast as it would without their influence? Doubtful.

In essence, we’re getting the worst of both worlds right now: a looming inflation caused by excessive money growth accompanied by a struggling real economy tied down intentionally by regulators in DC. We already have one side of the misery index, unemployment, at excessive levels; the other side, inflation, is right around the corner. The result is stagflation, a la the late 1970’s under Carter.

Obama is the worst President in U.S. history, but he hasn’t yet topped Carter’s level of the misery index. By election day, he just might. One thing is certain. The next President will be fully justified in using the phrase “It’s Obama’s fault” for at least a year or so into his Presidency, and maybe longer depending upon just how huge a mess he leaves us.