Archive

Posts Tagged ‘fiscal policy’
March 31st, 2011 at 6:05 pm
So Much for the Federal Reserve Creating Stability

CNBC’s Fast Money quotes an investment strategist who says that when Federal Reserve Chairman Ben Bernanke gives his first press conference on April 27, his remarks “could induce a 10 to 15 percent correction” in the market.  Here, “correction” means “drop.”

The reason the market might drop one-tenth of its value in a matter of hours is due to some analysts’ fear that Bernanke will not continue printing money (i.e. quantitative easing) to inflate the value of assets.  When values return to more realistic levels, investors are likely to stop banking on government-distorted policies to bail them out.

The purpose of the Fed is to tinker with the money supply and interest rates to stabilize the economy.  So far, the only stability it’s guaranteeing is as fake as a free lunch.

November 12th, 2010 at 2:48 pm
It’s Dangerous to Have a President This Weak

Traditionally, presidents facing opposition at home go abroad to find policy and political success.  Basically, if you can’t beat them, play with someone else.  It’s an especially useful move in the latter part of a president’s second term, when lame duck status settles in and speculation about a successor mounts.

Perhaps we’re seeing that now with one-term President Barack Obama.  One thing is missing, however, from the script: a foreign policy success.

So far, the president’s 10 day Asian trip has been a disaster.  It started with a badly handled mis-impression that 34 warships costing $200 million a day were escorting the president to India.  (They weren’t.)  Then his staff was embarrassed by press handlers working for the Indian government.  Now, he’s failing to secure a crucial free trade deal with South Korea while being ostracized at the G-20 meeting for his fiscal and monetary policies.

All this may make him more likely to be defeated in his reelection campaign, but it is a terrible projection of powerlessness to the rest of the world.