What do you think of this statement of the bailout/stimulus approach to borrowing our way out of debt?

"There is something desperate about the way people on both sides of the Atlantic are clinging to their dog-eared copies of John Maynard Keynes's General Theory. Uneasily aware that their discipline almost entirely failed to anticipate the current crisis, economists seemed to be regressing to macroeconomic childhood, clutching the multiplier like an old teddy bear.





The harsh reality that is being repressed is this: the Western world is suffering a crisis of excessive indebtedness. Many governments are too highly leveraged, as are many corporations. More importantly, households are groaning under unprecedented debt burdens. Average household sector debt has reached 141 per cent of disposable income in the United States and 177 per cent in the United Kingdom. Worst of all are the banks. Some of the best-known names in American and European finance have balance sheets forty, sixty or even a hundred times the size of their capital. Average U.S. investment bank leverage was above 25 to 1 at the end of 2008. Eurozone bank leverage was more than 30 to 1. British bank balance sheets are equal to a staggering 440 per cent of gross domestic product





The delusion that a crisis of excess debt can be solved by creating more debt is at the heart of the Great Repression. Yet that is precisely what most governments currently propose to do.|||Bad Idea if I have no money to pay my bills I don't take a loan out that I also cannot pay back|||An idea doomed for failure.|||obama stole the idea from us republicans


we should be complaining about that|||Going into debt never helps a person on a singular basis, let alone on a large scale like a country.|||Are you really interested in another opinion, or just spouting your own?|||we are so screwed - people are going to wake up with their entire life savings gone - when that reality hits main street Obama is right about one thing there will be catastrophe|||I've done it myself regarding my credit cards. Transferred balances to a card offering 0% interest for 6 months which allowed me to pay off my balance versus interest. Some of those countries which are having financial difficulties because of the global crisis offered lower interest rates for our debts so we can afford to borrow more to get the economy back on track. It really isn't costing us extra by the savings the interest rate will produce.|||I would like to see what would happen if nothing was done.


But I am scared of losing money that has been invested in the stock market for half my life.


If the stock market continues a long and slow dive, the money lost would be way more than 700 billion.


I don't really know if this would be the case but it is a scary thought to lose all the money we have been saving for the last 25 years by doing nothing.|||Bottom line is that people want and think that some way they can afford to have:





a $400,000 house, a $40,000 car, $10,000 credit limit on 4 credit cards and buy our children every little gadget and phone they want.





meanwhile we only earn $50,000 a year.





the bucket has a hole in it, and they keep putting water in and wondering why it doesn't stay.|||its a terrible idea. Its the globalist mentality that changed our commerce regulations in 1917. Instead of being a true asset monetary system it became a debt system where the privately own federal reserve can loan out money to own all houses and land through there debt system. 1929 the imploded there debt bubble and seized and foreclosed all the people's assets. In other words the fed reserve now owns everything in the united states. Through the years the globalists have pushed out a one world government loaning money out on this debt system to where every country in the world has this debt system. Just like in 1929 they imploded this economic bubble all over the world instead of just in the united states. That way they can be the world bank! Own everything. It is all happening folks. Please wake up ! Do your own research! Get pissed off about this! Our goverment is looting us and taking away our liberties! Wake the hell up !|||We are returning to Keynes because there are no monetary more tools to be used. How did you get the 10 per cent number. The current ratio is almost 90%. At one time, US had a debt ratio of 120% and we survived. See the link below for details.|||I think it is a leap into an economic abyss. The country will be bankrupt and balkanized by the end of Obama's first term. Hyperinflation will bring about total collapse of our nation and force the states to secede to save themselves from utter ruin. People thought the USSR was too big and powerful to go down too. I think we are about to prove we are not much better when push comes to shove.|||There are already bad banks. They are called citibank, Goldman sachs and others. THis is an old trick of business. American Express dumped all tehre crappy investment into Lehmans Brother and let it tank, while it keeps the profits .