Kirk,
I completely agree with your first sentence. I'm in the camp that thinks the response in the first few months (late 2008 early 2009) was helpful. After that, maybe not as much.
I think the Fed is doing about all it can, given that further fiscal action is not possible.
It is quite hard in a divided government, like ours, to craft an effective response to a sudden crisis. As Grannis wrote in the section I cited, the Federal Government took many actions in the last 6 years that they believed would help. Some did help - we needed to save the banking system in 2008. I was terrified the system would break down worse than it did. But the Keynesian stimulus didn't work as we learned in our textbooks, because this wasn't a "normal" recession. I also think that the more aggressive regulatory environment in DC and the uncertainty of Obamacare (and the percerption that this administration is anti-business).
Regarding Jerome's comment - "It could be that the Republican house does not want to do anything to help the national economy, because that would make Obama look good." I don't doubt it the case for some in the GOP, but it is also true that many well-intentioned Republicans oppose many of Obama's policies because they honestly believe the policies are misguided.
I consider myself to be a classical liberal / libertarian, so I am not a GOP apologist. And, as an investor/trader i am not whining about this environment. I think I understand what is likely to happen and can take advantage no matter which way the economy turns.
The reason I posted that article though is that I think it was a pretty accurate, concise assessment of the situation and the we can't hope to solve the problems if we don't understand what is happening. |
