What Obama Wants To Project Regarding The Economy
Brad DeLong on Ryan Avent's comment about Obama and the economy:
[Ryan Avent]:[W]hat is Mr Obama's plan? When Americans look at him now, what does he want them to see? Having bought so completely into the story that immediate deficit-cutting is necessary, Mr Obama can't easily demand new stimulus. At best, he can argue that his painful cuts are better in some way than those proposed by Republicans. "I'm not as bad as the other guy", is not a winning incumbent message when voters are upset.... Right now, the Obama administration seems short of economic ideas and (perhaps worse still) uninterested in labour market troubles. His Republican challengers aren't offering anything better. But Mr Obama has made himself extraordinarily vulnerable on the economy, and if he loses his job as a result he has only himself to blame.
The five things to do are: 1) recess-appoint qualified Federal Reserve Governors who understand the macroeconomics; 2) take as much risk as possible onto the Treasury's balance sheet so that the skittish private sector does not need to hold it; 3) use FANNIE and FREDDIE to goose the housing market; 4) have Tim Geithner say that at the moment a weaker dollar is in America's interest; 5) pray that the bond market does not panic.
(Emphasis supplied.) I'm not sure what DeLong means by "use FANNIE and FREDDIE to goose the housing market." I'm for using them to give relief to distressed homeowners, which should also help the housing market. Oh by the way, there is also $50 billion of HAMP money just sitting there.
Speaking for me only
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