February 17, 2010

Are there not any other routes and, if not, when do we get to the point of no return?

A dollar spent by a bureaucrat is a dollar spent but a dollar lent by a banker does not necessarily mean a dollar spent.

I believe that allowing the banks to help out the economy by lowering their capital requirements now, even at the risk of more bailouts tomorrow, is much better than having government bureaucrats trying to do it directly.

And it is because calling for the first available tool, fiscal stimulus, might make it more difficult to identify alternative options that I mostly differ with Martin Wolf when he states his case for the immediate short term need of fiscal looseness, “How to walk the fiscal tightrope that lies before us”, February 17.

And then of course is the fact that no matter how sure you are of the direction of where you are heading, sooner or later, one reaches the point of no return... and that must make a difference. Where is that point in this fiscal walk?