The Obama gang just can’t shoot straight on this one.

I don’t think Canadians were aware of the program’s existence before now…probably a lot of Americans were similarly in the dark. In normal circumstances the issue might have garnered 20 seconds on the news and would have been treated as simply another example of Fox ineptness or lame late night comedy but the timing…timing is everything after all.

At any rate, the issue is already dying down and my American friends need not fear a repeat of the 1812 shellacking…your White House is safe.

Back to hockey.

Just saying…

I know that belief in limited government is honestly held and I for one believe that too much government is not a good thing but at some point the Republican party is going to have to look beyond the contemporary conservative echo chamber if it wants to seriously entertain the prospect of effective opposition and an eventual return to government.

The good news is that the asset price bubbles themselves were far smaller in the US than in Japan (see charts below). Furthermore, the US central bank has been swifter in recognising reality, cutting interest rates quickly to close to zero and moving towards “unconventional” monetary policy.

The bad news is that the debate over fiscal policy in the US seems even more neanderthal than in Japan: it cannot be stressed too strongly that in a balance-sheet deflation, with zero official interest rates, fiscal policy is all we have. The big danger is that an attempt will be made to close the fiscal deficit prematurely, with dire results. Again, the US administration’s proposals for a public/private partnership , to purchase toxic assets, look hopeless. Even if it can be made to work operationally, the prices are likely to be too low to encourage banks to sell or to represent a big taxpayer subsidy to buyers, sellers, or both. Far more important, it is unlikely that modestly raising prices of a range of bad assets will recapitalise damaged institutions. In the end, reality will come out. But that may follow a lengthy pretence.

Pretences are rarely good things.

via Rumproast