Wackonomics

[alexamenos]

“In fact, the estimate to-date is that the TARP has actually had a gain of about $8 billion, while recapitalizing the financial system.

That is interesting.

A couple of months ago the Treasury had to step in and buy these assets because nobody could price them accurately, and without exposing these assets to the market, government accountants and spokespersons estimate their price to be 8% more than they were a couple of months ago. Enron and Madoff must envy those sorts of returns.

Anyway....if one prints up a few trillion dollars or so and then uses those trillions of dollars to chase certain assets, it's almost certain that the nominal value of those assets will rise.

The problems occur when we start confusing the rise in paper value with an increase in the sort of wealth that might have some impact upon the quality of lives we lead.