Pretty good. However, he makes the same mistake many others did re: the bond graders, i.e. their models are designed to reflect what the bond is worth *now*. Unfortunately for everyone, they lack the ability to forsee the future. The models weren’t ‘flawed’, they just reflected the current market.
I do like his solutions. Something the free market wonks don’t like to admit is that for an economic transaction to be truly ‘free’, it needs to be transparent as well.
Anyways, I don’t envy the Fed’s position. Its either death by deflation via raising interest rates, or death by inflation and lowering them. Unfortunately, since there is nothing anyone can do to prevent the needed deflation I think we are ultimately going to end up with both.
My own opinion is that the best thing for the country is raise interest rates, let all the speculators (and the banks that funded them) go bankrupt and start over clean with whatever is left over. Yeah unemployment will go up, but we’ll make do.
