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« New Edition of the Economics Newsletter | Main | Monetary Policy with Zero Interest Rates: Is the Fed Done? »

January 11, 2009


Laurence Hunt

Hear! Hear! Well said.


The limitation of the stimulus package is very well described in this post. However, we are dealing with a global recession and nearly all the major economies of the world are implementing a stimulus package. So, the overall effect could very well mitigate the effect of the recession/depression.

Stan Ash

One side of the stimulus package that has not been answered is what borrowing one trillion dollars will do to the credit markets. Since money is a finite amount, will not the government taking one trillion out of the market force the cost of money up?


So what is the source for all of this government induced "investment"? Isn't it all borrowed money? Why do politicians have this unending need to spend money they don't have? Seems to me we have finally produced enough ignorant citizens who actually believe there is something for nothing-so long as government is involved!

It doesn't take a Phd to figure out what happens when a government balloons the money supply beyond the productivity gains in the economy. Deficit spending (borrowing) creates more dollars chasing the pool of goods and services.. resulting in an inflationery effect on "prices". The fiat currency becomes less and less valuable. Interest rates rise. costs go up. Remember the Carter years? How fun.

Now we see the same sort of ignorant policies being rammed down our throats, only this time the spending is for leftist pet projects that would not see the light of day in years past. Now, support of every kind of pork is on the table, including all manner of outrageous "investments". Priorities like killing the unborn, financing ACORN, rewriting history textbooks to conform to a 'new reality".. and much more.

This "stimulus" is nothing but a grab by the left to create "change".. that none of us should live with.

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