You can almost hear the pips pop (or the Bavarians’ hops pop) as Euroland says it will help out the Greeks.
Short covering has begun, but remember that Greece is a tiny economy; the problems in Spain are much bigger.
And the Germans may well want to encourage a bit of currency decline to help their own flagging export economy and undercapitalized banks.
Gorilla says: “A bushel and a peck and a Euro, what the heck!”
Rather than waste more money on bankers lending to small businesspeople who aren’t asking for it, our leaders could be using the next round of stimulus (as woefully small as the first round) to hire people via a new WPA.
A trillion or more dollars could go part of the way towards reducing unemployment, but all that’s on offer is a measly $100 billion, much of it channeled to ridiculous tax credits.
Here’s the latest from the small business federation:
Their number one problem? A shortage of customers!
Only 5% of small businesses are worried about financing, so any focus on that clearly is a waste of time and money.
Getting people employed, on the other hand, generates lots of demand for small and large businesses alike.
Gorilla says: “A job in the hand is worth 10 Know Nothings and Bush!”
From ECB President Trichet:
“Keeping inflation expectations anchored remains of paramount importance, under exceptional circumstances even more than in normal times. Our framework has been successful in this regard thus far. But the lessons of the past fifty years — and, in particular, our success in anchoring inflation expectations — should remain uppermost in our minds.”
A more succinct explanation would be hard to offer as to why nothing much is being done about the worst recession in 70 years. Non-existent inflation remains the only thing central banks care about; 10% or more unemployment is always someone else’s problem.
Gorilla says: “A Trichet a day keeps you jobless, I’ll say!”
