Sunday, June 14, 2009

If you think the free market caused the Economipocalpyse...

...consider that a group of non-elected, politically appointed bureaucrats fixed the price of the most important economic variable through central planning. I'm not talking about oil, I'm talking about credit.

We have not been dealing with true free market capitalism for some time.

Our problems are largely caused by the fact that the US has a net negative savings rate. Do you think the setting the Fed Funds Rate at 0% is going to encourage many people to save? Even if you believe the understated inflation numbers from the government, you're losing money if you put it in a 1% interest savings account.

This is just one more example of well-intentioned government meddling backfiring and causing unintended consequences.

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