Monstrously Dumb

An interesting post over at The Aleph Blog on FED policy actions.

The Fed always delays trouble in the modern era. Slow to tighten, quick to loosen. No wonder that we built up a mountain of debt, because the Fed would always ride to the rescue of crises, but never let the pain settle in that would liquidate poor investments.

We need fewer banks, fewer homebuilders, and fewer auto companies. But guess what we bailed out? We bailed out the very things that were the least productive in our economy, and taxed those more productive to do so. Monstrously dumb.