On Mar 24, 2009, at 12:41 PM, Jordan Hayes wrote:
> Doug asks:
>
>> What is the outcome of "working" vs. "not-working"?
>
> Sorry for using shorthand: I believe that it can't work without
> addressing the issues raised in Michael's post. Since those issues
> haven't been addressed, taking that route would be a giant leap into
> the unknown (for the record: I think giant leaps into the unknown
> are bad). Since the reason stated by proponents is that it's a giant
> leap into the *known*, I think you have to resolve the two first.
>
> Maybe it would work, I don't know. It seems to be a daunting task.
> But I know that unless you know how to get around the problems
> identified, it's just hand-waving. And I suspect that this is
> widely known at Treasury, but it's too technical to bring up on ABC
> News.
>
> It's not too technical to bring up here, however; or is it?
Not at all. But I still don't know what you mean by "work." Keep the system from imploding? Return to the credit growth rates of 1999 or 2005? Provide reasonable quantities of finance to industry and households? Or bring us back to the days of a marginal propensity to consume of 105%?
Doug