OK, I'm no an economist. I just play one on the blogosphere. But there are some interesting signs out there. The US Government is actually trimming (albeit only slightly) its spending. And far from the sky falling as a consequence of the interminable budget battles and gridlock, unemployment is falling sharply and the stock market has been on a tear the likes of which we haven't seen in a long time.
Of course the Fed is also printing money at the rate of a cool $85 billion per month and pumping it into the real estate and bond markets. So one could argue that we are just creating a new government sponsored asset bubble and maybe laying the ground work for a nasty dose of inflation, Time will tell. But I'm not making any firm wagers on which way this is going to play out.
The Gospel Preached to the Patriarch Abraham
20 hours ago
1 comment:
The money printing is responsible for the stock market rise. I think disappearing debt- whether it is people who are trying to get out of it, or people who actually default- is responsible for the relative lack of inflation.
In order for something good to happen, the government has to be out of the way. It hasn't, in fact it keeps increasing the costs to every transaction. So, if we do have any genuine growth, it would have to come out of a field that they aren't looking at. Google became Google before the idiots on the Hill knew what happened. When we convert from one fuel to another, government often miss it too. They managed to prevent the move to nuclear power, and still insist on these large nuclear plants, which are less safe than many smaller alternatives.
So I expect the depression to continue, but I also expect people to interpret government behavior as damage and try to route around. I hope for the sort of innovation that keeps them befuddled for years to come.
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