Tuesday, December 02, 2008

Surprise! We Don't Know How We Are Spending the Bailout Money.

Boy, I wish my bookie was this generous...

"The head of a new Congressional panel set up to monitor the gigantic federal bailout says the government still does not seem to have a coherent strategy for easing the financial crisis, despite the billions it has already spent in that effort.

Elizabeth Warren, the chairwoman of the oversight panel, said in an interview Monday that the government instead seemed to be lurching from one tactic to the next without clarifying how each step fits into an overall plan."

Later on in the article Ms. Warren hits the nail on the head. Banks have slowed lending not because of a lack of capital, but because the creditworthiness of US consumers continues to weaken almost daily. Unfortunately, correcting that problem is not going to be easy. Creating high quality careers in the US economy to replace the thousands of jobs lost in financial, insurance, real estate and pharmaceuticals is going to be the key to a long-term revival of our economy. Throwing away my daughters future tax revenues to keep a couple in their overpriced ranch in Boca is clearly the wrong idea.

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