TPS

Are you saying that there weren't discouraged workers back in 1981-2? And if it's larger now, care to guess the difference... :-)

Sure, no one can say what it could have hit had the government not acted. In a presentation shortly after the crisis, I predicted it would not hit the Reagan/Volcker high (10.5%)precisely because policies were trying to prevent instead of cause a recession this time. Yes, it is impossible to know what we couldn't know--the "what if" scenario. We are both making guesses about a what if scenario. The difference is I understand I am making a guess, you don't. Without intervention on the demand side, it's quite possible a debt-deflation spiral could've wreaked havoc. The real issue is what probability I'd give to that scenario.

I was trying to say 1) TARP initially impacted deficits in 2008 and 2009; and 2) while there might have been some expectation of a return on the TARP investment, I don't know that anyone in 2008 was predicting when those returns would happen and how much they'd be "after-the-fact"? Geez, you didn't get that?

It wasn't $5 trillion more in spending. The debt is a consequence of increased spending and falling revenues. In the first year you guys mention--2007, the deficit fell from $250 billion (2006) to $160 bil. in 2007. Then, as the crisis widened, in Bush's last year, it went up to $460 billion. Both sides of the aisle pushed for stimulus and Bush got it both times. Obama continued the stimulus in 2009 and this year. The point, if the economy had continued to expand (from the housing bubble) instead of collapsing, there might have been a surplus eventually (GG's bet would've paid off). However, the crisis caused higher deficits not only from increased spending, but also significantly lower revenues due to higher unemployment. You mistake a deficit with spending only. So, yes, I do support deficit stimulus under these severe circumstances because the alternative would've been 20% unemployment in addition to significant debt accumulation. That is, tax revenues would have fallen significantly more and spending would've gone up automatically to support increased unempolyment benefits at that level. Btw, thanks for that original link. That's a handy tool.

Sure, after-the-fact. The point is that it impacted the 2008 and 2009 budget years. And yes they are touting the money spent where they've recovered it, but not much cheerleading about ALL of the bailouts (more than just F&F).

Pure speculation on my part. We'll know in a few weeks. Also too early to write off the publicized agreement--speculation on your part.

I would disagree with your first statement. This could have been worse than the Great Depression. Monetary and Fiscal Policies went to levels never before seen to prevent things from worsening. To compare, the Volcker/Reagan recession was engineered by the FED using high interest rates to wring out inflation, and the official unemployment rate hit about 10.5%. For the current recession, official unemployment never went over 10%. So in the former case, they let unemployment go, and in the latter they tried (almost) everythying possible to prevent it from spiralling out of control. Had the FED and federal government not done those actions, the bottom would've been at minimum twice as deep. So, yes, it's partisan to hold her to what she said when faced with the worst crisis in 80 years. And it was a little more than a "bump in the road." No you dolt. I'm trying to explain that it's idiotic to hold someone to something when we experience the worst crisis in 80 years. The Bush example was used to make the point that even the republicans realized something had to be done as early as spring of 2008. And, as someone pointed out, Bush then passed the TARP bill adding $700 billion to the deficit. But you are so myo(pic)-partisan-centric that you accept some right-wing talking point without thinking it through. Once again, I don't give a crap about Pelosi, and it will be a blessing if she loses her majority.

Anyone notice this quote by Stevie Johnson in Mark Gaughan's article?

I'm starting to think that Bernanke's jawboning about QE2 was a ruse in the so-called "currency war." His threat of QE2 helped push the $ lower, and US exports are one of the bright spots in the economy. If indeed he proceeded on QE2, Japan and China would be forced to undertake even more currency intervention. All this is prelude to the G-20 meeting, and lo and behold, there's an agreement to correct imbalances from all parties--deficit AND surplus. The indication of this (a ruse) would be the FED announcing in the very near future that QE2 will not be necessary. If this is the case, it's time to buy some call options on the S&P.

So it has nothing to do with that "Great Recession" thingy? I can't stand the woman, but this is just a petty partisan attack. Even Bush attempted to stimulate the economy with a tax rebate in 2008--before the collapse of Lehman.

Gee, really, you meant me? I never guessed. Maybe you don't read very carefully. You take my disagreement on what we think is driving commodity prices to mean I don't realize there is growth in emerging markets. NO. I simply think at the current time most of the price movements are being driven by speculation (which I think is the greatest. YOu think it's current global demand. We'll see. Your view is that this will lead to a supply-side inflation like the oil price hikes of the 1970s. Maybe. Again, we'll see... I understand how QE has impacted the $ carry trade and funds flowing to EMs. I understand how investors have tied commodity investments to movements in the $. I understand how the falling $ raises import prices. You seem to have a problem dealing with anyone who disagrees with you, as if there is only one possible outcome. The beauty of economics is that the future is uncertain, so we try to make our best guesses as to what that outcome will be. Most of our disagreements have been about inflation and how it occurs. OUr initial disagreements were about the possibility of high inflation, as you state above. I disagree that we will see "higher inflation," rather I beleive that we will again see a return to "inflation normal," the target the FED would like to maintain at 2%. Although, I have said it wouldn't surprise me if the FED let it rise a bit higher (3-4% range). However, the FED will not let it get out of control. So if by higher, you mean > 4%, then we disagree here too.

I can't think of any draft and pick in recent history that made me say WTF!?!? That said, I want to point out that I tried to keep tabs of what he did that first year, and I think in the first game he had an INT for a TD; but overall his stats were not good at all. I wondered at the time if maybe he wasn't all that; but we know now he is. Point of all this rambling: we shouldn't judge Troup by what he does this year either. The good thing is that he is getting experience.

If you really understood it, then you'd understand that when I say banks holding reserves on account at the FED, or money won't be created until banks start lending, or inflation won't kick in until the loans and spending lead to higher growth and lower unemployment, that's all related to velocity. So spare "us" the condescension.

Good thing you said "some of us here," because it's clear you really don't understand the concept. You tell "us" that it will change and bring inflation. Explain it then. And not in vague terms, but explicity how it will change and cause inflation.

Imagine that, we live in a country where you can disagree with your government. I'm with you, that really sucks. We need one God, one party......kind of like Islam....

Get a grip. The US was occupying Iraq. Like most occupiers, if they stay long enough, they become the enemy. As I recall, we went into Falujah after several Blackwater private security members were brutally killed. A lot of people died after the battle, and, as with all wars, many innocents. It's not uncommon for people to try to get humanitarian aid to those affected by the bloodshed. In this case there were even parents of an american serviceman killed in IRaq that was part of that group. Note, the presence of foreign troops led to a protest, then the first skirmish led to the growth of the insurgency. But it was all Boxer's fault, as can clearly be seen....

Well, the tone of your post made me want to delve deeper into this. From what I can tell, a large group went to Iraq after the US offensive into Falujah (which resulted in the death of 71 Americans and 2000 Iraqis) to provide humanitarian aid. This was after the devastation of Falujah. Note the list of aid given to those terrorists listed in bold below. This is also a quote from the article that your source said "disappeared" from an islamic website. Another example of a vast right-wing conspiracy? Yes, those damn liberals need to be put behind bars....

Magox...errr...Schiff responds.. Schiff, It's not a bubble

Editorial in the FT today: FT.com And a letter in response to the creation of ETC's for commodities, which essentially expresses my view on the role of speculators and speculation: Commodity speculation

That was funny.

Finally took a look at the data. Interesting the flows from 2001 to 2008: 01 $11 bil 02 $25 03 $34 04 $101 05 $54 06 $39 Then... 07 -$27 08 -$62 So they were jumping ship after 2006. Came across some other info looking at the Fed's purchase of MBS. Almost all of the $1 trillion purchased in 2009 was from GSE backed securities. It's the sellers I found intriguing: Rest of World (china): $220 bil ABS issuers $190 Brokers and DEalers $132 Private, state and local govt pension funds $85 AND MMF $213. Surprisingly very little came from banks. It looks, for the most part, as if the FED was trying to save the Money Market and keep foreign investors happy.

Bush is back?

If the VAT comes to pass, the details remain to be worked out...of course. Not all households behave the same. Those in the bottom 60-70% save 0. It's not really a choice; they consumer all of what they earn to pay the bills. The way a VAT changes "savings" is to increase "public savings" i.e. tax revenues. Conservatives love to point out that the bottom ??% don't pay any income taxes, so ANY VAT tax will be an increase in the overall taxes they pay. Regardless of whether or not there is a VAT those households will still spend all of their income. If QE crushes savings rates, then why has been rising? I agree with the last point, all that will happen is that we'll import those goods from some other country since we don't produce them. Of course, it will show up in the data that our trade deficit with China fell, "caused by" the appreciating yuan.

Yes, which is why I said it's about who takes the biggest hit--all will be, but some classes more than others.

Lower/middle class households will continue to buy clothes, toys and electronics from asia because we don't mass produce them in the US. A VAT is a way to shift the tax burden onto those lower income households, and yes it will lower consumption as that VAT% of income normally spent on goods is transferred to the government--e.g. a 10% VAT will transfer 10% of the income from households who consume all income to the govt. This will also help the trade def, as these households are consuming less of all goods, including Walmart's. At some point, there will be a day of reckoning for the govt, and the battle right now is to determine who takes the biggest hit--the top 10%, or the rest of us...