Tuesday, January 22, 2008

My Thoughts on the Fed

After today’s action by the Fed, I encourage everyone to read this article I found yesterday about the current path our fiscal policy is possibly taking us as a country. I found it very interesting and eye-opening. Now I am not a Harvard-trained economist, so maybe I just am not smart enough to realize how this is all going to help us overcome all of the economic problems we are facing now, but I am smart enough to realize that everytime the Fed jumps in to “save the day”, the dollar bills I have in my wallet and in my bank account and in my trading account because less and less valuable each day. I am so sick of this prevalent attitude we seem to have in this country to just live in the moment and forget about the future consequences of our actions. Each and every time the Fed does what they did today, all they are doing is creating a different bubble, an inflation bubble, that will affect not just the millions of irresponsible people that run up credit bills they can’t afford and then look for help when it’s time to pay up(again, living for today and forgetting tomorrow), but everyone in this country. I was born just as Jimmy Carter was coming into office, so I do not personally know anything about the problems of the late seventies, only what I read. I think there is a good chance we are on the same path as we were thirty years ago unless we do something about it now. But no one seems to care. We just want to stop this recession and all of the problems that go with it, because recessions are not fun. That’s fine – I understand wanting to avoid the consequences. However, aren’t recessions part of a normal economic cycle? They happen and have happened throughout history. What is wrong with just accepting it? In some cases, I think they can be constructive. And the funny thing is is that most of these actions are probably not going to stop the recession anyway – it is most likely upon us right now. I may be biased because I am fortunately not one of the millions in America being affected by the “credit crunch”. I live in a modest house that I made sure I could afford, and got a fixed rate mortgage when I bought it. I pay my credit card off at the end of each month so that I have no debt there. I don’t go out and buy new cars and new TV’s and expensive vacations every month or so because I know I can’t afford them and I don’t need them. So please excuse this rant. But I am not happy with the direction we are going right now, and I really do see bigger problems ahead of us, problems that will affect all of us, not just a select few. Nobody seems to care, however.

About the only good thing I can see coming from all of this is that if Hillary Clinton does indeed get elected(my worst nightmare), she will inherit such a mess that having to put up with her for more than one term seems unlikely. I have a hard time believing any candidate will be able to survive this mess for a second term in office, especially someone like her that will likely make things even worse.

OK, I am done for now. Sorry about that. Just had to get it out.

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