@PredictableChaos
Strangely, people tend to think more highly of their own senators and congressmen.
Nah, not me. I dislike all of them.
do you think I could whine and cry for a government subsidy?
Absolutely. This is your right. I think it's just after "pursuit of happiness"?
Another inalienable right is the right to think that Congress is full of bozos. New Gallop poll says approval is down around 10%. Strangely, people tend to think more highly of their own senators and congressmen.
Thanks it truly is a reality check and explains what we are seeing in the real world and not the spin that we read about.
Re: Bottom line
Tenacious
2/10/2012 10:30:25 AM
Yep, we're creating this allegedly paternalistic new evolution of Uncle Sam, the guardian of all. But he's really just Big Brother in disguise.
So if I make a decision -- say to get an ARM -- based on this promise of low rates for the next few years, and the FOMC later reverses its course, do you think I could whine and cry for a government subsidy to cover my higher mortgage costs?
Just saying.
Re: Bottom line
Dex
2/10/2012 9:58:28 AM
It seems to me that there will come a point when the FOMC will either have to change course or dig in its heels to insist it is right in spite of the data to the contrary. Either way, the committee looks like a bunch of idiots.
I'm wondering where the new policy of greater openness at the Fed will lead us. What if the economic indicators continue to be stronger than expected? What if employment really does rebound? The whole keep it at 0 interest rate strategy is predicated on a very weak economy through the end of 2014. Will the FOMC reverse course if the forecast proves wrong -- and will changing direction be worse than not knowing the future direction in the first place?
Love this Lenore.
In the last few years, people have lost a lot of high-paying jobs. (Think manufacturing.) Many of them have either had to settle for lower-paying work (Think Retail) or have become frustrated enough to leave the job market altogether. And anytime a person's income drops, it takes a huge amount of discipline to ratchet the spending down enough to stay solvent.
So most were happy to use a home equity line to fill the gap and now it's time to pay the piper. Thanks for providing the data that shows the reality most of us see.
Tokyogai --
You have done a great job of summing up our weird world of fianance and the dynamic of Keynesians vs. Austrians.
Here are the choices: Withstand resounding depression for a few years while the system entirely deleverages or fire up the money presses to inflate away the debt and risk hyperinflation.
'Personally, I'd rather deal with knowns: If we let the debt deflate, it will be painful for a while, but then at least we know we've cleansed the system.
If we try to paper over the system by creating more debt (both public and private), which we layer on top of the old debt... we are really creating and unknown of historical proportion.
Bernanke has really made a huge gamble in his legacy based on mostly theoretical academic investigations.. let's see what happens in the real world.
--Scott
Re: Bottom line
tokyogai
2/9/2012 4:32:16 PM
I agree, but it also scares me. When the money supply growth stops getting sopped up y de-leveraging I expect to see inflation come on strong. If people then start to borrow again, it will be a double whammy.
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