Very good post Pete, and it is sad that the people that need it are not getting it. I also agree it's because of regulations tagged on because of what happened when the money was given out without regulations.<quoted text>
This is probably one of the most insightful posts I have read on here. Now I am not so sure about Obama having that much control of the Fed, but interest rates being kept low and easy access to money are two of the main reasons for Wall Street success during a recessionary economy. Where else are investors going to place their money? And on a global level, with many other nations in economic turmoil, the U.S. stock market is an attractive venue for investments. The minute interest rates start creeping up and the minute the Fed starts easing back on bond purchases, watch what the market will do. I don't blame the Fed for doing what they are doing, they simply want to jump start the economy. But after this long, it is clear this strategy isn't working. In my opinion, it is not working because the institutions who can get this low interest money are not feeding it to the people who will spend it. I don't know all the reasons for this, but I do know some of them are because of stricter regulations regarding lending money and the hesitancy of people to enter into debt agreements.
I would propose funneling this money straight to the spenders. I would suggest how to do this, but I do not want to stir up a Topix controversy tonight. I will wait until martini night to do this :)
But I do believe as time goes on we both will see some changing of regulations so people who really need it get it.
A return of the "Glass Steagall Act" would be a good starter.