patrick.net

Too late. Proposing a huge stimulus package would doom the Democrats (even more) in November. The public hates everything right now. They hate bailouts, they hate stimulus, they hate Republicans, Democrats, and incumbents of any kind.
Obama doesn't have the votes to pass another stimulus now. They barely got $26 billion of state/government bailout waste passed.
I think additional stimulus are shelved and gridlock is the name of the game for 2 years. Of course, all of the policies and entitlements that expand automatically will continue to be a problem.
What happens with the expiring tax cuts will be the main issue before the elections, and I think Obama basically gets his extend them/let them expire for people making $200k+ plan.

The funny thing is as a renter I am personally no fan of bailouts or QE 2.5. I carry my own health insurance and pay my own rent.

Let the mother burn is fine by me.

But people opposed to Keynesian stimulus spending need to realize this is a one-way Highway To Hell.

You just don't double consumer debt over 6 years, pull the plug, and expect things to hold together -- Consumer debt was $8T at the end of 2001, and peaked at $14.4T in mid-2007.

No more stimulus is going to mean no more FHA, no more FRE/FNM, no more BAC, no more WFC, no more financial system at all.

I already have seen this movie when living in Japan in the 90s. Once the funny money is stopped, the Potemkin facades fall and everyone dependent on their labor to make an income gets liquidated one by one in a deflationary feedback loop of consumer pullback. Then the leechf--- rentiers attached to the productive laborers begin to fail as their own leverage gets reeled in.

It is brutal but has a beauty all its own.

It's also a waste but some people are of the mindset that it's necessary to destroy something to save it.

Ptipking222 says

They barely got $26 billion of state/government bailout waste passed.

IF you meant to call this waste, I disagree. Many states are truly broke, and the money goes to things like paying public school teachers and other essential services, after they have already cut a lot.

The ideal situation for many politicians would be to have continued stimulus, but to be able to say they voted against it.

Stimu-loss will come. All we need is an emergency, say, states not being able to pay teachers, cops, and firemen. Incumbents know they're doomed, some have already decided not to run again... they will kamikaze this thing if it's the last thing they do!