200810.31
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Keynesian Idiocy

Via the WSJ Real Time Economics Blog: European Central Bank board member Mario Draghi Friday called on governments to bolster demand by boosting spending or cutting taxes, the first such exhortation from an ECB official during the current crisis. It’s far more typical to hear ECB officials, including President Jean-Claude Trichet, admonishing governments to adhere…

200810.31
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Rewarding the Irresponsible

The NYT has a story about the Treasury Department’s plan to help homeowners facing foreclosure: As the Treasury Department prepares a $40 billion program to help delinquent homeowners avoid foreclosure, it confronts a difficult challenge: not making the plan too tempting to people like Todd Lawrence. An airline pilot who lives outside Norwich, Conn., Mr….

200810.31
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Personal Income/Spending Report

According to the Bureau of Economic Analysis and its monthly report on Personal Income/Spending, in the past few months, US consumers have cut back on big-ticket purchases and expenses and started saving for a change. Nominal consumer spending decreased 0.3% for the month of September, after a flat August. This was inline with economists estimates, as a loss was…

200810.31
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Banks Cave In to Political Pressure

Politicians seem to have succeeded in bullying the nation’s bankers into lending their newfound, vote buying government capital. Politicians didn’t agree to jam taxpayer money down the gaping balance sheets of the nation’s banks without expecting something in return. It’s an election year if you hadn’t heard and the economy is not exactly humming on…

200810.30
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Impoverishing Society

Sheldon Richman rips the bank bailout at the American Conservative: Here in the land of the theoretically free, as Mencken called America, the central government is about to become part-owner of the nine largest banks and many smaller ones, too. It will acquire dividend-paying preferred stock in return for “injecting” cash into the allegedly seized-up…

200810.30
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The Federal Reserve – Lender of First Resort

The Fed’s balance sheet continues to expand: Oct. 30 (Bloomberg) — The Federal Reserve bought commercial paper valued at $145.7 billion in the first days of the program aimed at backstopping the market, indicating the central bank is generating most of this week’s record gains in short-term corporate borrowing. The central bank extended $144.8 billion…

200810.29
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FOMC Policy Statement

The Federal Open Market Committee decided today to lower its target for the federal funds rate to 1 percent. FOMC Policy Statement: The pace of economic activity appears to have slowed markedly, owing importantly to a decline in consumer expenditures. Business equipment spending and industrial production have weakened in recent months, and slowing economic activity in many foreign…