THE FED NEEDS TO BE CAREFUL WHAT IT WISHES FOR...
THE MASSIVE INJECTION OF LIQUIDITY INTO THE INVESTMENT BANKS AND WALL STREET WAS AN ATTEMPT TO "BRING THE ASSET BUBBLE BACK"...
BUT THE OLD ASSET BUBBLE IN HOUSES AND STOCKS IS REALLY A ZOMBIE NOW...
YES... THE FED CAN ATTACH THE MONETARY "ELECTRODES" ...AND MAKE THESE WALL STREET ZOMBIES SEEM TO DANCE...!
BUT IS THAT REALLY THE GOAL...TO WHAT END?
AN ECONOMY WHERE EVEN A ZOMBIE CAN DANCE...?
THE NOTION IS THAT WALL STREET IS A "LEADING INDICATOR" AND THAT IF YOU CAN GET THE ZOMBIES TO DANCE...AND BRING BACK THE BUBBLES...? THE REAL ECONOMY WILL FOLLOW!
BUT CONSIDER....
AFTER A CRISIS OF COLLAPSE AS HAPPEN IN SEPTEMBER 2008...ISN'T THE REAL ECONOMY THE NEW LEADING INDICATOR...?
AND SHOULD NOT WALL STREET WAIT FOR CLUES FROM THE REAL ECONOMY THAT THINGS ARE IMPROVING...
REMEMBER TRUE KEYNESIAN ECONOMICS WAS AN ATTEMPT TO "JUMP START" THE REAL ECONOMY WITH SHOVEL READY JOBS... REMEMBER?
NOT TO JUMP START THE SPECULATION IN ASSETS WHICH WAS THE CAUSE OF THE CRISIS IN THE FIRST PLACE...
SO WE HAVE A PERVERTED FORM OF KEYNESIANISM HERE...
BRING THE BUBBLE BACK FIRST...BY FLOODING WALL STREET WITH PRINTED MONEY...
AND MAIN STREET WILL FOLLOW...?
OR PERHAPS NOT...NOT THIS TIME....THIS IS NOT 2000 REDUX.
THIS IS STARTING TO LOOK LIKE A HYPER-INFLATION STARTING UP... ANYTHING THIS TOXIC AT EVERY LEVEL CAN NOT HAVE A GOOD ENDING.
