If you want full employment, then roll up your sleeves

http://smirkingchimp.com/thread/mike-whitney/36690/if-you-want-full-employment-then-roll-up-your-sleeves

When the recovery began 2 years ago, the rate of unemployment was 9.5 percent. Today it's 9.1 percent. Think about that for a minute. Doesn't that prove that the market isn't really self-correcting after all? I mean, if the market was self-correcting then unemployment would have gone down by now, right? But, it hasn't. Why?

There's a long answer for that, and a short answer. The short answer is that unemployment can stay high forever if the wrong policies are in place. If you don't believe that, then vote Republican in 2012 and watch what happens when they start hacking away at public spending. Unemployment will soar to 15 or 20 percent in the blink of an eye.

So, it's the policy that matters not the market. And when the wrong policies are in place, then demand stays weak, people get laid off, and the economy goes into a funk. The good news is that we know how to fix the problem and get the economy revved up again. The bad news is the politicians are not particularly interested in doing what it takes to put people back to work. In fact, unemployment doesn't even seem to be on their radar.

Maybe that's because some of their constituents don't really mind high unemployment; in fact, they kind of like it. It crushes big labor and puts pressure on wages. Maybe that's why no one's griping.

More at the link --

Apparently the fed was buying 85% of the treasuries security offerings with QE2.

If we had a stronger balance sheet it would be easier.

That could certainly work -- but they'd really have to ante up the cash.

:eyes:

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