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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: CalculatedRisk who wrote (262773)7/21/2010 2:47:24 PM
From: patron_anejo_por_favorRead Replies (2) of 306849
 
Problem with "long term deficit reduction" is that any one administration has no way of seeing that through, and politicians always make excuses why "now is not the right time" to cut back on spending. So I'll always be skeptical of long term fiscal planning. As would anyone who has even a modicum of political insight.

The Fed should say "we're finished, mission accomplished" and start raising ST rates, even before they unwind their mammoth positions. At least that would get banks off the schneid and given them incentive to start lending. Otherwise they'll play the "borrow for free, lend to Uncle Sugar at 3%" game until the cows come home.
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