As we all know by now, government spending and the Fed’s liquidity programs have provided a substantial boost to the economy. Some would argue that these government programs are simply delaying the inevitable and masking over the real problems in the system.
According to Annaly Capital Management, these programs are having an especially profound impact on the housing market. As we’ve often argued, many of these programs are nothing more than grandiose wastes of taxpayer dollars and do nothing more than kick the can down the road while adding substantially to the debt burden of the future.
After all, this short-term painkiller does nothing to actually attack the long-term cancer that is plaguing the economy (it’s the debt, stupid!).