by Ryan Teeples
Have you ever felt a charitable desire to help a poor soul who is losing his Maserati? Have you ever welled up inside with compassion for an industry which just had an unfortunate run of bad luck and made too many bad business decisions?
No? Well you have no soul then. And if a Fed Historian is right, you will be forced to "donate" your hard earned dollars to help these needy banks.
"Officials are playing with fire,'' said Allan Meltzer, a Fed historian and economics professor at Carnegie Mellon University in Pittsburgh. "With good luck, none of these liabilities will come due. We can't expect that good luck, and we haven't had it,'' he said in an article on Bloomberg this morning. (http://www.bloomberg.com/apps/news?p...2GQ&refer=home )
He, and many other economists are not optimistic that the government will be able to recover its $30 billion "investment" in the banking industry bailout, and that money will basically come out of the taxpayer pool.
Granted, the economy will benefit, but I'm of the school that the market needs to correct sometimes, and a little recession now and then is a good thing.
I'm interested to know what the rest of you think about this. It's certainly more a social and political issue the way I've presented it. But it leaves underlying questions crucial for forex traders to understand, as they may dramtically impact the US ecomony.
Will this bailout strategy work?
Will a failure of the plan cause consumer and investor sentiment to spiral further?
Will Batman and Robin be able to escape the grasp of the Joker and his men?
Looking forward to hearing your thoughts.
By the way, as equities remain uncertain, we are watching the USD/JPY S&R levels very closely. Check out what we have: http://www.pfxglobal.com/usd-jpy/usd...ard.html#step3.
We do this kind of analysis with video explanation for all major pairs at www.pfxglobal.com
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