QE 2 - Will it do more good than bad

[washunut]

It is just too expensive to operate in this country, and it's because of those regulations and taxes and I'd even venture to say corruption at the local level (with zoning laws seeming to be nothing but a game of favors).

can't debate that point.

 

[majora$$hole]

if it leads to an audit of the federal reserve then that will be good. imo.

 

[phattonez]

Quick question: if the stimulus, TARP, QE1, etc. all worked, then why do we need QE2?

 

[oldreliable67]

Quick question: if the stimulus, TARP, QE1, etc. all worked, then why do we need QE2?

quick (and incomplete) answer: initial failure to recognize that this was largely a balance sheet recession, more similar to Japan's experience than the typical post WWII inventory/oil shock recession. As a balance sheet recession, it is primarily, almost exclusvely concerned with debt associated lack of liquidity when funding drys up. "The Holy Grail of Economics, Lessions from Japan's Great Recession" by Richard C. Koo is pretty good on the topic.

Out of time for now; can expand later if you wish.

 

[Missed AB]

Quick question: if the stimulus, TARP, QE1, etc. all worked, then why do we need QE2?

I hate to answer your question with another question... Where do you think we would be if there was not stimulus, TARP or QE1?

DOW:
Unemployment:
Bank failures:
USD/Yen:
Euro/Yen:
GDP growth:

I ask this because it seems in your working you leave some doubt that it was a failure.

I agree that another round of QE while in a recovery phase is irresponsible. But I also think the emergency breaks stopped us from hitting a point of no return.