Fear returned to global financial markets today, with stocks sinking and the dollar rising sharply on renewed worries about an economic slowdown in China and the United States. President Barack Obama met with senior economic adviser Larry Summers and “talked through some scenarios” on what was playing out around the globe, and how to keep the U.S. recovery on track.
Obama, signing a bill meant to boost U.S. manufacturing, said he was determined to do everything possible to hasten the economic recovery. The problem is – how much more can he do?
Legislation to support small businesses and manufacturing and bolster state finances might be saving jobs, but are unlikely to make much of a difference if American consumers remain reluctant to buy, or if the global economy takes another turn for the worse.
The Federal Reserve may have moved back in the direction of easier monetary policy on Tuesday, but with official interest rates already near zero the central bank fired off its big guns long ago. Nor is the country in the mood politically for another fiscal stimulus through more deficit-spending.
Plenty for the president to ponder, then, as he heads for the Florida Gulf Coast for a brief visit at the weekend, meant to show that the region is ”open for business.” The real vacation comes later, though, with 10 days in Martha’s Vineyard.