snoot,
Economic processes are quite complex and not easily understood without advanced study of the subject, usually under formal direction at the university level. It's difficult to have a meaningful discussion of economic policies when some of the members of the discussion have none of that formal education on the subject. So much for the general American public and their widely held public debates.
That education is not required in order to be elected to public office -- too bad, maybe it should be -- and it certainly is not required to be able to vote. In fact, in this country one does not even have to be literate to vote. This leads me to believe that politicians would act in a more educated way if they were elected by a more educated public. But at least those who have been elected somehow, miraculously, had the wisdom to give control of the Federal Reserve, and indirectly its Board of Governors and members of the FOMC, to people who have had high levels of that education.
The first definition of the word manipulate is to operate, use or handle something.
A car left running in gear and with the emergency brakes off, and with no manipulator sitting behind the steering wheel, is a very dangerous thing. Yet it happens very frequently in this country with the obvious, and very often unpleasant, outcome. So much for the idea of not having manipulators.
So we need manipulators. But we need then to be awake and paying attention, and we need them to be sober, and we need them to be considerate of their responsibilities to the public, and we need them to be educated regarding the operation of their particular vehicle.
The financial crisis we have come out of was caused, in general, by unchecked, or even sometimes encouraged, capitalistic greed. Thank goodness we had the right people with the right education in a position of power, primarily within the Fed and the Treasury, such that they could jump behind the wheel and manipulate this country away from the otherwise inevitable result, if they had not, of another depression which because of the huge financial leverage, and number of countries involved around the world, would have been greater than the Great Depression. And it's too bad that some of the European countries do not have that leadership and are in their own depression at this moment.
We cannot use as an example what things would be like now without TARP and QE. We cannot turn back the clock and turn off those efforts to see what would have happened without them. To claim one or both as failures is an uninformed, unprovable, emotional guess. I choose to believe that those programs worked and are continuing to work. I believe that because I understand the technicalities of those programs and because those programs were conceived of and put in place by very educated people who have had very successful financial carriers and were not subject to public election.
As I wrote the other day, the S&P500 companies just ended their most profitable year ever. That profit was approximately 17% higher than the next highest year which was 2007. That is not a bubble. That is a return to the norm and a little bit more as it ought to be. Granted, unemployment is still too high, but that is primarily due to increased productivity -- AKA more output per work-hour. I don't see any failure here. Where's the failure? Are we to decrease productivity so that we can put the unemployable back to work? I hope not.
AI
