Marshall Sohne

A Fed Rate Hike Won't Solve the Current Crisis

I hope that talk of raising interest rates by the fed by some of the fed governors is just a head fake.The economy is superleveraged as well as our government therefore us being deeply in debt. Our financial system our banks are contracting their balance sheets creating a deflating effect on various assets and industries. Presently we must recognize that the increase in the price of energy is causing a restructuring of society and business. We must for the forseeable future plan our strategies around higher energy prices. We have to use less import less which will require us to restructure how we think and live. Life will still be good. It seems like our government has been a little slow at coming up with the strategies I think the people of this country are waiting for thier leaders to lead. I think its time for the people to work their own strategies. We dont need a lot of the junk we buy to be happy. We dont need to import our way to bankruptcy. Weve got so much going for us in this great country of ours. We got food, we got clean water we got a beautiful land technoloy we got universities we got a diverse population living with a bill of rights and a constitution. We as a people can figure this one out. I think we need to show what we can do as consumers of imports lets cut back on our uses of hydrocarbons. Im sure we will eventually have electric cars. Our motor companies have to get on board before they go bankrupt enough with huge suvs that get minimum mpgs. They should assume gas will get more expensive and people here will become more frugal. They also have to have strategies or they will be bankrupt. Hoping that the price of oil will go back down to 30 a barrel is not a strategy. We must plan for the future. We have to look at ways to reduce our imports. If that means more people living in the cities and less suburban sprawl so be it. It if means more bicycles and less suvs so be it. If it means less materialism and more spiritualism. I think we can still be happy. I think the author is right we have inflation the government knows this because they help it along by printing the money. I think the government strategy is to slowly inflate its way out of this deflation bubble and thereby rescue the banks our economy and homeowners is a reasonable strategy certainly not perfect. Raising interest rates during this type of economic contraction will accelerate the liquidation phase and cause a lot of pain if we can avoid this with a measure of inflation and some leadership so we can restructure our economy we might get luckly. When I hear our government officials blaming this on the speculators either they dont have a clue or they as politicians prefer avoiding their responsibilites by scapegoatting the "evil speculators"