WHAT THE FED IS OVERLOOKING: Fed Ponders Jobs, Inflation Targets - WSJ.com

Fed Ponders Jobs, Inflation Targets - WSJ.com

What the Fed seems to be grossly overlooking was brought home by some recent conversations with people back in the US (and, it's also somewhat reported in the media).

In other words, a lack of credit. In part brought about by regulatory excess (i.e. the banks are afraid to lend); and, in part brought about by government policies such as the lawsuit against mortgage loan originators to the tune of 100's of billions of dollars.

With absolutely insane economic policies from the Administration (such as today's tax the millionaires and don't recognize the value of capital gains - or, in other words, stop the investment and venture machine - after all, it doesn't create government jobs or union jobs, so what good is it) and bureaucrats and regulators out to punish lending and investment, is it any wonder that houses don't sell and businesses don't borrow.

The Fed needs to recognize that the credit / lending relationship in the country is broken. The government wants to convince the public (which is easily led along unfortunately) to believe that it isn't at fault for the economic policies holding back the economy, etc. Rather, it's the banks and greedy private business people.

Things are clearly getting worse and the Administration can't seem to stop coming up with policies, almost daily, to reinforce its incompetent management of a free economy. Until this freedom is restored, the Fed's policies are a bubble that is only going to appear to ameliorate what is rotting from within due to the policies of Obama.