It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
“Minsky” was shorthand for Hyman Minsky, a hitherto obscure macroeconomist who died over a decade ago. Many economists had never heard of him when the crisis struck, and he remains a shadowy figure in the profession. But lately he has begun emerging as perhaps the most prescient big-picture thinker about what, exactly, we are going through. A contrarian amid the conformity of postwar America, an expert in the then-unfashionable subfields of finance and crisis, Minsky was one economist who saw what was coming. He predicted, decades ago, almost exactly the kind of meltdown that recently hammered the global economy.
To prevent the Minsky moment from becoming a national calamity, part of his solution (which was shared with other economists) was to have the Federal Reserve - what he liked to call the “Big Bank” - step into the breach and act as a lender of last resort to firms under siege. By throwing lines of liquidity to foundering firms, the Federal Reserve could break the cycle and stabilize the financial system. It failed to do so during the Great Depression, when it stood by and let a banking crisis spiral out of control. This time, under the leadership of Ben Bernanke - like Minsky, a scholar of the Depression - it took a very different approach, becoming a lender of last resort to everything from hedge funds to investment banks to money market funds.
Minsky’s other solution, however, was considerably more radical and less palatable politically. The preferred mainstream tactic for pulling the economy out of a crisis was - and is - based on the Keynesian notion of “priming the pump” by sending money that will employ lots of high-skilled, unionized labor - by building a new high-speed train line, for example.
At $12.1 trillion, the national debt ceiling was just $349 billion away from being topped after unprecedented intervention into the financial markets that included $700 billion in bailouts and a $787 billion stimulus package.
On August 7, the U.S. Treasury Department sent a letter to lawmakers warning them that another vote to raise the national debt ceiling was imminent. Since that time, the economy has improved somewhat. Lawmakers are hoping that this will allow them to put the vote off until later in the year and provide them with some political cover.
Originally posted by hotrodturbo7
reply to post by HunkaHunka
Whose to say that it's not a volume-based buildup by serial traders and that there will not be a massive round of profit taking that will initiate a death spiral?
Originally posted by eldard
reply to post by HunkaHunka
You trust MSM we'll trust real numbers and common sense. Indeed we'll see.