Steven Hansen's  Instablog

Steven Hansen
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Steven Hansen is an international business and industrial consultant specializing in turning around troubled business units; consults to governments to optimize process flows; and provides economic indicator analysis based on unadjusted data and process limitations.
My company:
Econintersect LLC
My blog:
Global Economic Intersect
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  • Moon Kil Woong
    , contributor
    Comments (13224) | Send Message
     
    Asides from the seasonal pickup during the summer including home buying and selling I also don't see anything to cheer about. Even the home sales pickup seems to be deflating way faster than it inflated. Excessive government spending is doing nothing but breeding the need for even more excessive government spending just like QE needs more QE to not deflate the economy. This is why government spending and QE are not helpful or sustainable for the economy in the long run. Only private sector growth can heal the economy, and to do that you need systemic change.

     

    Helping TBTF banks is far from systemic change. Bad banks and financial institutions are the first and possibly the greatest drag on the economy, because they find a need to hoard assets, increase reserves, shed assets onto the taxpayer through selling bonds to government entities (Fannie and Freddie), the central bank, and anyone else who doesn't care about getting the short end of the stick. And often they still engage in the same risky gambling rather than loaning money to businesses who take responsibility for the risk.

     

    If anything the Federal Reserve should open their discount window to small banks and businesses, not TBTF zombie banks.
    31 Aug 2013, 03:37 PM Reply Like
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