The New Stimulus, $400 Billion over the next 9 months!
NEW YORK (CNNMoney) -- The Federal Reserve announced "Operation Twist" Wednesday, a widely expected stimulus move reviving a policy from the 1960s.
The policy involves selling $400 billion in short-term Treasuries in exchange for the same amount of longer-term bonds, starting in October and ending in June 2012.
On Thursday, President Obama unveiled his latest $450 Billion stimulus program to create jobs. Incidentally, he never used the word “stimulus” in his speech, presumably since his last $800B round of stimulus did nothing to budge unemployment. Instead, he called the plan a “jobs bill”, as if a change in semantics will improve the outcome. His Keynesian plan has been debunked in enough articles that I won’t rehash all the criticisms here. Just suffice it to say, the plan amounts to borrowing more money now to spend it on some temporary stimulus to the economy. While Mr. Obama promises that this $450B will not add to the national debt, he has yet to reveal where the money will come from to pay for it. Anyone want to wager that his plan won’t be financed with non-binding budget projection cuts five to ten years in the future?
Presidential candidate Ron Paul has proposed an economic stimulus plan of his own. It may seem antithetical to see the words Ron Paul and “stimulus plan” in the same sentence. After all, this is the man who has railed against government borrowing and spending in Congress for over thirty years. The man who has spent a lifetime preaching that the government’s role in the economy is to set simple rules, protect sound money, and enforce contracts and property rights; not to dole out money and favors while picking winners and losers with taxpayer money. But in this case, the word “stimulus” is a semantic distinction to show how Ron Paul’s policies would generate an immediate boost to the economy and jobs.
continue at http://wp.me/p1bQ0X-dL
Estonia takes a play our from President Warren Harding and Mises and does not buy into stimulus, after a contraction of 13.9%, they are now growing at 8% - only the experts at NPR do not know enough of our own history or Austrian Economics to realize the reasons for Estonian growth, and how it related to our own crash in 1921. President Warren Harding's policy of not intervening in the market were continued under Calvin Coolidge in 1923, much like George W Bush's policies of intervention were continued under Barack Obama.