Larry Kudlow lays out a compelling case here:
A series of investor-related polls shows how totally detached the president is from the nearly 100 million folks who directly or indirectly own stocks.
Between the House passing the China currency bill (and I think the Senate may as well) and various politicians pushing for a foreclosure moratorium, one has to wonder what sort of politics/policy another year of 9-10% unemployment will generate. I am guessing China will finally emerge as the new bipartisan big bad for U.S. politics (more for economic than military reasons), while there will probably a flurry of new housing ideas like this one proposed by economist Glenn Hubbard.
It’s the return of the inflation tax, as Ed Yardeni rightfully notes:
The rational for another round of QE is to boost economic growth and to avert deflation. In other words, Fed officials would welcome a pickup in the inflation rate. The problem is that they are stoking an inflationary fire in the commodity pits. I doubt that’s the sort of inflation they are rooting for. Presumably, they want prices for consumer goods and services to rise moderately to stimulate producers to expand their capacity and to hire more workers. Higher commodity prices are a tax on consumers and producers and can have the opposite effect.