Jun. 23rd, 2011

  1. Second round of Quantitative Easing will cease on schedule.1

Amid increasing political pressure and turbulent financial conditions in the world economy, the Federal Reserve is letting its massive bond-buying stimulus program expire in the next few days without a new initiative to prop up the weak American recovery.

Why we can’t afford more war.

The nonpartisan Congressional Budget Office said Wednesday the "explosive path" of the nation’s public debt would exceed 100% of GDP by 2021, even with expected policy changes.

On the Tea Party’s move towards austerity

On the U.S. budget, Bernanke said he didn’t think that sharp, immediate cuts in the deficit would create more jobs, as some Republican and other advocates for belt-tightening have argued.

"In the very short run," he said, "the fiscal tightening is … at best neutral, but probably somewhat negative for job creation."

So, that’s one hit.

2. US risks default on its debt!2

Neither side reported an alignment in positions about raising the nation’s debt ceiling, an unsettled issue that could force the government to default on its obligations by early August.

This is Repugnicans and Demorats playing chicken with our lives and economy. Strangely, neither side is pointing out that it was GW Bush’s policies that got us here. However, it is the ignorant yokels from the Tea Party that is keeping the rest of the GOP from helping to find the brakes. Some of them are even considering letting the US default for 30 days or so, as a tactical play. What fools we elect to congress these days!

Some Republican lawmakers have said a brief default, which would be inevitable in August if lawmakers fail to raise the nation’s $14.3-trillion debt ceiling, might be acceptable if it forces the White House to deal with large budget deficits.

The problem with that plan is that it isn’t Obama that sets the budget. According to the US Constitution, the budget is set in the US House of Representative and nowhere else. The US House is in Republican hands at the moment.

In 2003, when I came here to Switzerland, it cost about 1.20 CHF to buy a dollar. That same dollar now only costs 84 centimes, or 0.842CHF! The mighty are falling as I write this.



  1. This round of quantitative easing expires at the end of June. []
  2. The debt ceiling must be raised by early August or the US goes into default. []

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