Dangerous New Phase Indeed
The IMF has warned the the global economy has entered a dangerous new phase with growing downside risk. US growth is forecast at 1.7% for 2011 and 1.8% next year. It calls on policy makers to "take action".
But bad decisions could put the US economy in a lost decade and the West into recession. The IMF wants the Fed to print money to save the world.
Wednesday we'll see the Fed announce Operation Twist, or QE3, where the Fed goes long to keep long term rates down while improving short term ECB bank liquidity by $300B. Theoretically equities and commodities go up and interest rates stay low so sovereigns don't go bankrupt. It's already priced in so it won't do anything but cause you and me price inflation in a flat-wage environment.
The US economy grew at 0.7% under QE2 with no improvement in unemployment or growth and the economy sputtering near "recession" (that would mean further receding deeper into the 2007 Depression). Policy makers want Obama to spend $500B on jobs while cutting taxes for some while raising taxes for others while Bernanke inflates the money supply to bail out EU banks...WHILE...the SuperCongress cuts spending and raises taxes over the next decade. Does anyone believe these clowns can pull THAT off?
I'll tell you how much growth the US economy has had this year. Zero. How can I say that? Look at the markets. They are at or lower than where they started the year. The only thing that is up is prices, thanks to Helicopter Ben money printing. How will it end?
I need to learn how to survive in my dark, unheated home and eat the predators that I have to shoot breaking in. I wonder how many BTUs my daily crap would produce? Enough to cook my cannibalized dinner, thaw some snow and keep me from freezing in the dead of winter?
But bad decisions could put the US economy in a lost decade and the West into recession. The IMF wants the Fed to print money to save the world.
Wednesday we'll see the Fed announce Operation Twist, or QE3, where the Fed goes long to keep long term rates down while improving short term ECB bank liquidity by $300B. Theoretically equities and commodities go up and interest rates stay low so sovereigns don't go bankrupt. It's already priced in so it won't do anything but cause you and me price inflation in a flat-wage environment.
The US economy grew at 0.7% under QE2 with no improvement in unemployment or growth and the economy sputtering near "recession" (that would mean further receding deeper into the 2007 Depression). Policy makers want Obama to spend $500B on jobs while cutting taxes for some while raising taxes for others while Bernanke inflates the money supply to bail out EU banks...WHILE...the SuperCongress cuts spending and raises taxes over the next decade. Does anyone believe these clowns can pull THAT off?
I'll tell you how much growth the US economy has had this year. Zero. How can I say that? Look at the markets. They are at or lower than where they started the year. The only thing that is up is prices, thanks to Helicopter Ben money printing. How will it end?
I need to learn how to survive in my dark, unheated home and eat the predators that I have to shoot breaking in. I wonder how many BTUs my daily crap would produce? Enough to cook my cannibalized dinner, thaw some snow and keep me from freezing in the dead of winter?
posted by lugh lampfhota at 9:52 PM
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