While it is unusual, I don’t see the creation of such a facility as a bailout. On the other hand, let me say that a year from now, when the dust has settled and we read about all this, I suspect you might actually feel different about the Fed’s actions.
>> when the dust has settled and we read about all this, I suspect you might actually feel different about the Fed’s actions.
What I expect to see are the financially irresponsible breathing a HUGE sigh of relief... “Way to go Helicopter Ben! You da man! Bail me out and inflate my debt away BABY!”
And another (probably smaller) group... responsible folks who didn’t join the go-go speculation craze... who had little or no debt and cash. Cash that is now worth less, if not worthless. Do you think those of us in that category will also “feel different” about the Fed’s actions?
You get what you reward. Ben Bernanke is rewarding the profligate and the irresponsible. Tell me... can this go on forever? The bubble is dead, on to the next bubble? Leaving the taxpayer and the financially responsible to clean up on Aisle 9 while the speculators move on to the next party?
Is this a good long term strategy for the financial health of the US?