Recovery

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Hello list members,

 

Some journalist are now suggesting the US economy is recovering due to the massive infusion of liquidity into the system following the near collapse of the banking system. It is clear that while these measures may eventually help to reflate the system, the medicine is coming with serious side-effects, such as high debt and concerns about inflation and the dollar exchange rate. Moreover, the manifestation of the side-effects is only slowly being understood. Based on an analysis of the period and transit influences in the SAMVA USA chart, the recovery is likely to be attenuated by volatile asset prices while the real economy recovers only sluggishly.

 

Bailout helps fuel new era of Wall Street wealth

Efforts to save financial system helped titans make fortunes in fresh ways

New York Times - 11:27 a.m. ET Oct. 17, 2009

 

Even as the economy continues to struggle, much of Wall Street is minting money — and looking forward again to hefty bonuses. Many Americans wonder how this can possibly be. How can some banks be prospering so soon after a financial collapse, even as legions of people worry about losing their jobs and their homes? It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took last year to stabilize the financial system — reducing interest rates to near zero, bolstering big banks with taxpayer money, guaranteeing billions of dollars of financial institutions’ debts — helped set the stage for this new era of Wall Street wealth.

http://www.msnbc.msn.com/id/33354321/ns/business-the_new_york_times/

 

This economist predicts a lower dollar ahead.

 

The Dollar and the Deficits

How Washington Can Prevent the Next Crisis

Foreign Affairs - C. Fred Bergsten - October 15, 2009

 

 

 

 

 

 

 

 

Summary

The global economic crisis has revealed the folly of large U.S. budget and trade deficits, as well as of the strong dollar that makes them possible. If it is serious about recovery, the United States must balance the budget, stimulate private saving, and embrace a declining dollar.

 

Thor