Reply #147: Galbraith may not have called out anyone

[jeanpalmer]

but clearly he disagrees with the current approach. The idea of funneling money to banks as a way of getting the economy going never made any sense to me. And that's why Geithner and Bernanke are wrong. They're going down the wrong path and it's going to prolong and exacerbate this recession. Additionally, the path they're pursuing will reward the people who wrecked the system.

As Galbraith points out, lending cannot occur without borrowing. And borrowing won't occur until household balance sheets improve. And balance sheets won't improve until people are employed and income loss is reversed. That's where the focus should be. So funneling money to banks is totally ass backwards. What the banks are going to do with that money is hoard it or use it for speculative purposes.

I like Galbraith's comprehensive approach to the problem. Hopefully, somewhere along the way, Obama starts to listen to economists like him. It seems he better do it soon because, if you look at the numbers, this thing is heading downhill fast.

Thanks for the link to anothergood article.