Saturday, November 24, 2012


"It is inaccurate to blame the 2008/09 financial crisis for the lagging U.S. recovery. Poor post-Bubble economic performance instead relates directly to previous boom-time excesses. And there should be little debate that loose Federal Reserve policies played prominently throughout the mortgage finance Bubble period. A system just doesn't almost double total outstanding mortgage Credit in about six years without unleashing major distortions in the allocation of resources and spending/investing patterns throughout the real economy. And surely no one can argue that four years of zero rates and massive federal deficit spending have fostered sound resource allocation and significant economic wealth-creating investment."

Mis-allocation of resources, lack of real investment dollars, a fostering of more credit excesses in attempt to revive a financial mania, no wonder the economy is not creating enough jobs and wages continue to fall to stagnate, not keeping up with the rise in costs of things we need.

SOUND MONEY. Growth is fostered by sound money policies and rewards for real investment. With a ZERO FED interest rate policy, governments spending well beyond what they can afford to spend in efforts to revive the economy have not put us on a path to recovery.

A one sided approach will not bring us to a soft landing. The stock market being targeted by the FED specifically goes against their doctrine, but desperate times call for desperate measures?


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