Well, the economics textbooks, such as they are, are only working from past history and models (which are deeply flawed). The theory is that governments should be working counter-cyclically (straight Keynes) and taking over the role that private financial institutions are unable to take over in periods when trust in the institutions and their capacity for lending is crippled (like now). The gamble, and the danger, as remarked over and over again -- even by Keynes -- is inflation with the injection of new money. The gamble is that the deflation of the economy is worse temporarily than the inflation that will come later -- and will somehow have to be paid for. The United States is in a weird position in that its currency is the cornerstone of the international market, so it has been able to do all this fantastic borrowing without paying too much of a cost. But the day will come. The question is: will the economy be around to cope with that? The part that no one knows.

yours,

Peter T.