| akuma587 said: I think its ironic that everyone has turned into a fiscal hawk now, when there actually is a need for the government to inject money into the economy, but everyone has been pretty quiet for the last eight years while we have been running a deficit even in good economic years. Its like reverse Keynsianism. |
This.
I would like to add, that printing money isn't all that dangerous right now.
From a worldwide perspective, the dollar is overweight anyway. Much of the world depends on US exports for food, technology, and raw materials. The overweight dollar has caused these products to be too expensive for many. Additionally, it exacerbates the plummetting oil prices, while the US benefits from cheaper gas and other petroleum products because of the drop off on demand, the rest of the world sees marginalized benefits and oil producing countries go will go bankrupt if they don't cut supply. You can imagine the end result of either scenario.
From a national perspective, we are on the verge of deflation, many sectors are already affected. Housing, energy, electronics, automobiles are cheaper then they were before. Why is this bad? Well, the home you bought is worth less than it was before. The TV on the shelf and the car on the lot in the store is selling for less than it cost them to make.
Increasing the money supply and keeping interest rates low is what is needed. The government needs to spend more to make up for lost private demand, in combination with a failing banks and no lending we are looking at a very Depression like scenario; where bad sh*t compounds and the economy settles below full employment. Do we really want to reach a point where the only answer is a switch away from a our good-enough-pseudo-freemarket or WWIII?
We just need to make sure we slow it down once the situation passes. Let's not make the same mistakes we made in 2004-2005 when the tax cuts weren't repealed (to the accepted maximizing revenue rates in pretty much every industrializzed nation of 0-40% graduated, except the US), interest rates didn't go up fast enough, and we didn't reregulate lending. Of course the US economy, is so big and important, we get rich off the developing nations, act irresponsibly running up debt when we shouldn't, agitating markets with war and intrusive foreign policy, spend more than we should on stupid sh*t, and don't build up infrastructure then the rest of the world hates us and we stand there with our d*cks in our hands asking, "Dur, what happened?"
I would cite regulation, but I know you will simply ignore it.
