tag:blogger.com,1999:blog-5956838.post7735264982597618048..comments2023-11-22T01:14:54.298-08:00Comments on amor mundi: "The Truth Is Rarely Pure and Never Simple." -- Oscar WildeDale Carricohttp://www.blogger.com/profile/02811055279887722298noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-5956838.post-26991702104283512152010-11-04T06:09:28.365-07:002010-11-04T06:09:28.365-07:00Yeah, that is scary.
I should add, what Ben Berna...Yeah, that is scary.<br /><br />I should add, what Ben Bernanke is doing with his $600 billion monetization scheme is analogous to a regressive tax increase. He is debasing the dollar which leads directly to higher prices for commodities priced in dollars. These commodities are the inputs to everything the American consumer needs, such as energy, food, and clothing. Cost increases will get passed to the consumer and this hits the poor and middle classes disproportionately. This is almost like an anti-stimulus. <br /><br />I mostly despair over this. I don't remember voting for Bernanke, and I don't remember approving an increase in what amounts to a regressive consumption tax -- a tax that is hard to distinguish from the 'Fair Tax' the Steve Forbes-type Randroids are on about. <br /><br />I swear we're in the Matrix.Impertinent Weaselhttps://www.blogger.com/profile/16641434724740469395noreply@blogger.comtag:blogger.com,1999:blog-5956838.post-53194691055197697542010-11-03T21:28:37.218-07:002010-11-03T21:28:37.218-07:00I agree with everything but the very last bit -- I...I agree with everything but the very last bit -- I fear Obama *can* get a second term without recovery and that scares me shitless.Dale Carricohttps://www.blogger.com/profile/02811055279887722298noreply@blogger.comtag:blogger.com,1999:blog-5956838.post-56211033207610440182010-11-03T19:01:20.375-07:002010-11-03T19:01:20.375-07:00governments, unlike households, actually can indee...<i>governments, unlike households, actually can indeed spend their way into prosperity when that is the last resort</i><br /><br />Government should run deficits to moderate a recession, but must also bank surpluses to moderate the expansion. This is the whole point of managing the natural business cycle with policy. And it also happens to be Keynes' key insight, though for some reason only the stimulus part is ever emphasized. <br /><br />Politicians want always to stimulate. Nobody's a Keynesian in an expansion when everything is roaring. And so we just stimulate and stimulate, introducing distortion atop distortion, bubble upon bubble, until the economy can't function without those distortions, bubbles, and stimuli.<br /><br />Welcome to America 2010.<br /><br />Obviously we need a second stimulus, a massively huge second stimulus. But how big? The economy has built up a tolerance to stimulus. It's going to take a whole hell of lot more than anyone's ever seen to bring the unemployment rate down to 5% in 2 years. I guess after the election, we can forget about that. And all Ben Bernanke seems intent upon doing is stimulating another stock market bubble. <br /><br />I don't think most people are ready to face the reality of our situation. There will be no recovery, none at all, no matter what they do if we're not willing to admit our banking system is entirely insolvent. Everything we've done -- from TARP to the DIF increase to HAMP to ZIRP to FASB accounting rule changes to QE1 and QE2 -- is designed to paper over the abject insolvency of our banking system. And like a cancer, it just gets worse every day. <br /><br />For Obama to get a second term, we need this economy to recover. It won't recover with an insolvent banking system.Impertinent Weaselhttps://www.blogger.com/profile/16641434724740469395noreply@blogger.com