I guess that's good news.
Sounds like a plan to me. As I understand it, the Fed can only do two things:
1. Print money and shove it out into the system.
2. Pull money back from the system and burn it.
I think that's it in a nutshell. Which one should they do now?
The Tea Party Congress, like Europe's bourgeousie, would rather wallow in liquidation, Puritan cleansing, and mass default than tolerate the possibility of a solution.
To those who excoriate monetary stimulus as some form of devilry -- most readers it seems -- my question is whether would you rather see bigger deficits and bigger publics debts instead. Because that is exactly what you get if central banks fail to act in a slump, if you don't lose you democracy as well.
Even AEP's loyal readers, as evidenced by the comments, take him to task for his wrong-headedness.
One point of agreement that I have with Bernanke is that the Fed has done all it can and that the President and Congress must right our economic ship by eliminating the federal deficit. The last thing we need, to quote David Stockman, is for the Fed to inject more high-grade monetary heroin into the financial system.
“...drive up nominal GDP to a trend line growth rate of 5pc, doing so transparently so that markets know exactly what the objective is and when the stimulus will be unwound.
I have no doubt that this would bring about a full recovery very fast if conducted with enough panache, but is it possible to marshal political consent for such revolutionary action?
The Tea Party Congress, like Europe’s bourgeousie, would rather wallow in liquidation, Puritan cleansing, and mass default than tolerate the possibility of a solution. “
No, ‘faux growth’ from the Fed won’t do it.
Now real 5% growth- say from regulatory and tax cutting- is a cure. But where’s the political support for that except the Tea Party he despises?
Whats missing in this story “IS” Obama wants the economy to slide back into recession which we actually never got out of.. He has done everything in his power to stymie the United States recovery..
Trillions down a black hole.. that literally nobody knows where it went.. He WANTS the US to fail.. or founder on the economic rocks.. He has planned it and performed it and WANTS IT...
Only Rinos and democrats give him the benefit of the doubt and there is NOT any doubt.. He did it ON PURPOSE...
Recession the new definition = government isn’t getting enough revenue.
Stimulus = electronic adding, directly into government paychecks and funds (which are in the anti-free market).
Everyone else, there’s no such thing.