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Comment by jswinghammer | Hacker News Reader

Wait and see. We're not even close to out of the woods yet.

GDP is up. Dow is back to 12,000. Banks are liquid. Output is as high as it's ever been. Krugman and friends, not to mention the more conservative economists, do not share your views. I really don't understand the populist sentiment.

Most of that is government stimulus which cannot last forever. The banks are definitely not liquid. They are basically insolvent. You can tell this because they don't mark their assets to market.

The government stimulus (QEs) can last forever because we have a monopoly on our currency. The Fed can print as much money as it wants. Of course, too much stimulus causes inflation. Banks have the cash, and are lending.

Now I agree with you. The bank bailouts were supported by just about every economist with a brain. They worked, not ideally, but well enough, and better than some expected.

But the populist sentiment comes from that the lowest bracket of society is still not out of the recession. The recession is over in the technical meaning, but tell that to the down-and-out and see how they react. It's also not the case that the financial system is totally repaired, though thankfully it looks like the perverse incentives in home mortgages are going away, at least.

Well, GDP growth doesn't exist in a vacuum. It's spread throughout every demographic. Every demographic is consuming more than it's ever consumed (highest GDP). Now, I'm assuming you might mean high unemployment as your main complaint. We have more funds now than we've ever had to subsidize unemployment checks without affecting inflation rates. The unemployment checks are going out to many and are in abundant supply. Contrary to what you might hear, the most disadvantaged brackets are being taken care of.

>"the lowest bracket of society is still not out of the recession"

If by the lowest bracket you mean "the bottom 80%", then yes.

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