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Related source » The Parallel Between Drug Addiction And The Reliance On Economic Stimulus Is Just Too Strong To Ignore
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“And as with drug addition, an economy builds up a tolerance. Each time the government successively stimulates with printed money or deficit spending, ever larger doses are needed to achieve the same result. […] This time around, the stimulus-fueled recovery is so mild that the economy is already relapsing into recession before the Fed has even begun to tighten.”
— Peter Schiff, JUNE 14, 2011 (peterschiffblog.blogspot.com)
Back when I was earning a salary, I had a whiteboard in my office, which was usually filled with multicolored markings that made some sense to me and several of my colleagues. These equations and crude diagrams were frequently modified, as my thoughts and discussions with colleagues progressed (and regressed) from day to day. But one block-printed marking was never erased — "NEEDS MORE WORK".
Similarly, it would seem, our government's fiscal and economic gurus are surrounded by semi-permanent post-it reminders with the words "Needs More Stimulus" printed on them. As if they needed reminding of our Nation's long-standing addiction.
Goosing the economy by periodic injection of printed money, in the hopes that such artificial stimulation will gain a momentum that will carry the economy past the inevitable withdrawal of the fix-induced frenzy of spending, is the addled mind-set of drug addiction. Such continued application of cyclical frenzy can only lead to increasing amplitudes of fluctuation and correspondingly diminishing returns on investment of wealth, energy, and precious time.
I don't pretend to know what the correct solution for our Nation's economy is. As my economics professor is fond of repeating, "Macro is hard". Moreover, it certainly is not my area of expertise; I'm just a novice. But I am confident of this: continued application of massive stimulus ain't it.
Post 1,654 Addiction Nation
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