So what could it possibly mean to claim that the economy must never be allowed to fall into recession? I’m thinking here of similar claims:
* “That drunk is sobering up. Quick, give him a shot of tequila!”
* “That druggie is coming out of his acid trip. Get the syringe!”
* “Don’t look now but that insomniac is going to sleep. Someone wake him!”
Now, it’s fair to say that the person hollering out the solution to each of the above scenarios doesn’t really understand the nature of the problem.
So it is with the Fed. It sees stocks falling, credit markets under pressure, unemployment rising, investment falling. But rather than conclude that all these factors represent a bubble, it has the opposite response: keep the bubble inflated at all costs! FULL ARTICLE