Friday, August 13, 2010

Friday the Thirteenth

Yesterday I quoted (Reuters) from Monday the 9th:

Evidence the already sluggish recovery has lost momentum has shifted discussion at the U.S. central bank from exit strategies to whether the economy needs more backing, which would most likely come in the form of buying more longer-term assets...

On 24 July I wrote:

So again I say, let's not have the Federal Reserve print money and use it to buy up debt. Have them use that money to pay off debt.

On 8 July I wrote:

Here's what I want the Fed to do, Paul. I don't want them to buy debt. I want them to make debt go away. I want them to take their trillions that they're gonna use to buy debt. And I want them to use that money to pay off debt. Pay it off. Just pay it off. Make the debt go away.

On 7 March I wrote:

To make things better, you admit you made mistakes in your policy decisions, and you start cutting down on accumulated debt any way you can. You cut debt and cut it until you have sure signs that the economy is solidly improving. And you make sure nobody has to deal with huge tax liabilities arising from your solution. You establish recovery by brute force.

On 4 September 09 I wrote:

What rule says we must lend out Bernanke's newly printed trillion? If it really is free money, if it really is money from nothing, then what do we lose by giving it away? Nothing. What do we gain by using it to pay down debt? Plenty! But the Fed is not doing that. At the Fed, they don't want to do things to remind people that Federal Reserve Notes are money from nothing.

On 19 August 09 I wrote:

We need to get out of the slump. To do it, we need to reduce the level of existing debt. The slump was caused by excessive accumulation of debt. We couldn't run fast enough to stay out in front of it anymore. It caught up with us. And now, we're in a hole.

We need to fill that hole. That's my solution. That's how we get out of the slump.

I say, let the Fed print one more trillion dollars. And use it this time to pay down debt for people. Something in the neighborhood of twelve thousand dollars for a family of four.

On 6 July 09 I wrote:

The quickest way out is just to print money and use it to pay off debt. But it's like touching a snake, isn't it? You can't stand the thought of it.

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