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rampant inflation, or deflation, are the two biggest threats to this, or any, economy. And the biggest driver of interest rates. Also unwanted, of course, are hordes of jobless people. One World War Z movie is plenty. The Fed sought to generate a little inflation and, more importantly, prevent deflation, by firing its arrows to boost the number of workers, i.e. shoppers. Well, the middle class, and the poor, are teetering a little, having to work free-lance, part-time, here and there. Not to say that getting paid decently to serve the well-off is so bad, but ultimately, it’s not good for the soul. No doubt there are still plenty of well-paid pencil-pushers, machinists, and even construction workers fueling things. But if the economy’s health rests on its entrepreneurs and small businesses creating jobs (and shoppers), an axiom which we are often reminded of, then perhaps higher rates will encourage banks to lend to those opening a corner store or a call/tax/help center. I often hear that it’s damn hard for an individual with an idea to get a business loan, assuming you’re not in venture capital circles. Despite not sticking their necks out, bank profits are healthy, to say the least, thanks to the past six years of rock-bottom rates. Perhaps we need to let our bankers and everyone else with a few nickels to get even more comfortable with this not-so-new normal by providing a steady-as-she-goes accommodative policy. (I think it would also help if the government granted permission for immigrants to freely put their shoulders into it without having to look over them). Confidence is wonderful, if tenuous, and it grows from the economy’s roots. Even if there are doubts, at least the big money folks can look forward to more workers, more shopping and to higher prices for stuff. The hammer has to come down when bread gets to $5 a loaf, or we run out of clean air. Then, no more money for you, big boy. The alternative — deflation — sounds unhealthy: like keeping a plant in the closet, or anorexia.
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At the end of the spacewalk the two Russian cosmonauts unfurled their Country’s flag in honor of Russia’s Flag Day. Yurchikhin said, “Today is a holiday, Russian Flag Day. We congratulate all Russians. We must love and respect our flag and then others will respect us.”
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It’s a capital strike, just like a labor strike — politically motivated, intended to damage the economy. Public exasperation born of desperation will damage the Democratic Party and the President’s re-election chances.
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