The big news

The Fed has just "printed" one trillion dollars of new U.S. Greenbacks. It has created a huge amount of new money out of thin air. Governments have that prerogative. It doesn't actually run the printing presses faster. It does it in a more complicated way than that but the result is the same. Its main effect is to put fresh cash in the pockets of the banks and other financial institutions. The good news is that it is not debt. The taxpayer is not going to be required to pay more tax to fund it. The bad news is that it will devalue whatever greenbacks you at present own. They will buy less in the future -- "inflation" in other words. So it IS a tax in the long run.

Will it work? Will it get the banks lending again? Will it create jobs? Nobody seems terribly optimistic. The real problem is to restore business confidence so that businesses start hiring again but most of the O-man's agenda is anti-business and intent on jacking up business taxes so it will do nothing for that. Abolishing regulatory burdens on business (e.g. Sarbox) and halving company tax is what is needed to perk up business. Like FDR before him, Obama thinks business is the enemy -- when it is in fact the only way out of the present problems. Kicking business when it is down so stupid that only a Leftist could do it. But that is the FDR/Obama thinking.

Lots of commentary here

Posted by John Ray.