I remember how thrilled I was in 2008 when Congress voted down TARP. But then the stock market tanked, and Warren Buffett said that Congress had to act, and next thing you know. . .well, I won’t revisit all my bitter criticisms of that bailout.
I just read that Congress deadlocked on a stimulus. In any rational world, they would not be voting so quickly to spend money. The economy is going to sleep for a while no matter what. We have time to think about what the economy really needs before Congress enacts another whopping spending bill.
Keep in mind my idea to give everyone a short-term line of credit. I think that could inject support quickly where it would help most in the near term, without costing very much.
Unfortunately, I don’t think that deadlock will last. We will probably see something like a re-run of 2008, with the stock market threatening to plummet and all sorts of economists and financial dignitaries standing on the sidelines yelling “Spend! Spend! Spend! There is no time left to lose!”
Feeling helpless, I dissent. I readily concede that there will be needs that justify spending, and perhaps a lot of it. But I have the quaint idea that we should gain an understanding of the needs first, then vote for the spending.
If the public was not on board with TARP and the Obama Stimulus, I don’t expect that the support for this new spending spree is going to be any better. There is a non-zero probability that this revives either the Tea Party, Occupy Wall Street, or both. I have no desire to side with the populists, but I sure will not be defending what I see as a reckless, irresponsible spending bill.
Enjoy deadlock while it lasts. By the time you read this, it will probably be over.
No, I’m with you. I hope the deadlock continues. How about a federal stipend for unemployment?
This is all nonsense anyway. If the lockdowns aren’t lifted by the end of April, the stimulus won’t do a damned thing. The grocery stores will empty so fast it will astonish you. We will be trading in barter by July.
Well, the “good” news is that in certain places (New York for example) we’re on a path toward an acute outbreak that will span several weeks and peak in the next 1-2 months, so it will have burned through the population by summer. Perhaps politicians astutely expect that the flattening is not going to happen, and the worst will be over (with considerable pain) sooner than previously thought.
Mark, the disease is burning through pretty much everywhere. Everywhere we test, we find the same rough positive ratio of COVID-19 sufferers in the population of people with flu-like sympt0ms- between 8-15%. The only real difference between New York and the rest of the country is that New York has run over 1/2 of the RT-PCR tests the US has run. If New York were truly 10 times as infected, that ratio for their tests would be running 60-70% positive.
I had thought that every respiratory failure death since early February was being tested for COVID, but I was apparently mistaken about that. The death numbers you see are from people who were alive when they tested positive. I can’t find a single example were a dead body was tested. The deaths everywhere else are occurring, just not being reported as COVID deaths as far as I can tell.
I had a family friend die of pneumonia just a couple of weeks ago. There was no test on him before he died, nor after according to his family. Now, he didn’t die of COVID most likely- he had had pneumonia off and on since last Summer due to a failing battle against lymphoma, but that he wasn’t tested surprised me. I suspect no one really wants to back test the dead from the last 3-6 months for obvious political reasons.
Not a single politician has enunciated a plan of what to do if the lockdowns don’t have any effect. They seem to think that the food will keep showing up in the grocery stores, and the medicines at the pharmacies, but that is a foolish belief. If people start to understand there is no plan, they will start hoarding everything, and a 2000 dollar check from the government will just be worth no more than a can of soup.
“But I have the quaint idea that we should gain an understanding of the needs first, then vote for the spending”
Agreed. If the biggest problem facing us is lack of hospital capacity — presumably that is the reason for the extreme social distancing measures — then why are we not directing all stimulus towards expanding emergency capacity? I understand that some supply is fixed and inelastic. But, if we are talking about multi-trillion dollar spending bills and fatalities (in bad scenarios) that number 200k-2M, then that is on the order of millions of dollars per potential fatality. Surely, there is some way to expand emergency capacity if we are willing to spend $1M per severe patient. As we expand capacity, then we can also reduce social distancing, which is also causing trillions in damage. In a war, conserve your resources to spend on weapons (treatment and vaccines).
Piling on is happening.
Government naturally wants to bail out the primary dealers since they manage cash flow for Treasury. Why not make the Senators to learn cash flow management or we cut off funding to their state capitals? Do that and we can eliminate the primary dealers and much of this TARP stuff goes away.
“As investors attempt to assess the severity of the upcoming downturn, Federal Reserve Bank of St. Louis President James Bullard predicted the U.S. unemployment rate may hit 30% in the second quarter because of shutdowns to combat the virus.”–Bloomberg.
Oh, 30% unemployment. That’s all. But we are saving elderly with co-morbidities from dying from a cold virus.
Mnuchin says he wants $4 trillion to give to business. And we are in the first inning of this thing.
You know, sometimes you have bad options and you take the least-bad option. That least-bad option today is going to back to work, and taking care of the ill.
We have Medicare in the US, covers all elderly. Build tent hospitals, fine, pay for it with printed money.
That looks to be the least-bad option.
I’m fairly certain my father will die if he gets the disease. Myself (health issues, low lung capacity, asthma), and my daughter (asthma) could also be at risk. If we let it burn I and my family could either die or suffer permanent lung damage.
Very true and very poignant. I very much look forward to debating you in the future, asdf, and I am positive we will get there. Have faith in your fellow man. We push comes to shove we will pull together.
I hope none of that happens. Hang in there.