Tuesday, December 29, 2009

An Official Notice of Future 'Crowding Out' of Private Investment: Fed Proposes Tool to Drain Extra Cash - WSJ.com

Fed Proposes Tool to Drain Extra Cash - WSJ.com

It's been rather obvious that the Fed is likely to have to step in to help funding the government's borrowing again in 2010.

As such, it will effectively be either using 'new printing' or 'crowding out' of private investment.

This sure looks like the Fed is trying to float a red herring of monetary prudence to obfuscate the first stages of crowding out.

They almost make it sound like something good that banks won't have the money to fund business borrowing to create jobs. But, isn't that what the government really wants - more people obliged to work for government or be on government's dole?

Are we really through the first inning yet of this economic game?

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