my man fred gos to town
on todays knarled up kapshow

"What we are about to see is the final discrediting of monetary policy and the other modern neo-classical synthesis shibboleths. Household balance sheets are about to sink by something like $10 trillion. This must be compensated for by something like $6 trillion in additional Federal debt. That means deficits on the order of $2 trillion a year for the next few years. This $150 billion stimulus just isn't going to do the trick.

Those aggregate demand implied by those $2 trillion deficits will leak away because of the trade deficit unless we impose an across the board tariff. Alternatively, impose a selective tariff on those countries with which we have excessive trade deficits. That will sock it to the oil exporters and is VERY politically feasible.

Huge budget deficits will allow the Fed to RAISE interest rates, thereby crushing all this hedge-fund drive commodity speculation and pushing the dollar back up, thereby bringing cost-driven price inflation completely under control and opening the door to still higher budget deficits. Higher interest rates will also crush Wall Street and the banks, which need crushing bad. Assuming budget deficts are truly massive, there will plenty of cash rich private investors like Warren Buffet to step in and create new banks. We don't need to protect the existing boobs and incompetents.

We are facing a classic Keynesian crisis of collapsing aggregate-demand as everyone shifts from spending to saving. Massive budget deficits are the only answer."

my comment
to his uncle sam
policy thrill ride

fred
reading your stuff reminds me
of one of those early 70's
street percussion bands

man do u bang away

if we did everything
you suggest here policy wise
why the whole earth's market economy
would start to look like
a human face accelerating at 6 g's