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  • QE3 is Going to be a Refinancing Event
    QE3 will be a refinancing event.

    Bonds go back to Wall Street. Debt gets removed from the Nation's balance sheet. There is no law preventing the Fed from just canceling its debt with itself.

    The next thing that will happen is all of the broke government pensioners will be paid in T-Bills. If we raised taxes 10% and paid all of the government employee's 10% with T-Bills our nation is just fine.

    That way the MMTer's can sit and be happy that the flow of funds is not reduced, the pie is just as big and the budget is just fixed.
     
    It's really not that complicated if people just act boldly.
    Tags: QE3
    Mar 27 10:17 PM | Link | Comment!
  • Block Grants to the States - Fixes Everything
    Imagine waking up tomorrow and reading the headline, "New Congress Passes Legislation to Save States", pretty cool headline.

    The Congress, the Governors are all moving this direction, and it means your muni-bonds are going to be just fine.

    Here's how they are going to do it.

    The States are broke.  The voters want a more limited Federal Government.  Perfect time for a "Block Grant".  The Fed's give the States all the money they always have been but with out the rules on how to spend it.  This makes the members of Congress keep their jobs and act like a new-Federalist, the Governors then get to take this money and use it to plug "their" budget woes.

    This is the perfect idea at this time.

    It's been kicking around for quite awhile but I credit James Buckley speaking at the Heritage Foundation on CSPAN for making this so obvious to me how this fixes some of our most pressing problems today.

    Plus it is such a political winner for the people in office, they look like heros.
    Feb 01 2:08 PM | Link | Comment!
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