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Originally Posted by guyy
Where you have been the past few months? People aren't working, saving, or spending, and investments went poof as speculative bubbles popped and the Stanfords and Madoffs scurried into their ratholes.
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About 93% of American workers are employed. Americans during this recession are saving at a higher rate than in the recent past :
Personally my investments have been sh*t, but you can't win them all.
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So what do you do? You have the Mellon/Hoover course of action, hugely successful in the past as we all know, of doing as little as politically feasible. You can sleep well at night knowing that your policy conforms to invisible hands dogma. Or, you can try to apply human knowledge to the situation through the institutions that we have created and reproduced. It comes down to a passive, crypto-religiosity vs. purposive human action.
Future inflation? You'd be better off worrying about the problems in the here and now. Foresight and planning are important, but if this crisis isn't dealt with adequately, you'll be trading in tins of tuna fish.
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And as Washington continues on their spending binge, the Fed is preparing for the on coming inflationary impact. So what we will have is one set of geniuses trying to stimulate the economy and another set slowing it down. You got to love Washington.
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Feb. 19 (Bloomberg) -- Federal Reserve policy makers signaled their determination to prevent any spiraling of inflation as a consequence of unprecedented U.S. fiscal stimulus and record growth in the central bank’s balance sheet.
Fed officials introduced long-term inflation projections yesterday, with most favoring a 2 percent rate. The forecasts will help moor the public’s expectations, Chairman Ben S. Bernanke said.
The step shows that Fed officials are intent on fulfilling their mandate to ensure price stability after the stock of money known as the monetary base soared 80 percent in the past six months. With long-term inflation expectations in household surveys hovering at 3 percent in that period, the surge in cash could threaten to send up bond yields, hindering efforts to generate an economic recovery by year-end.
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Bloomberg.com: Economy