Walk the walk

One has to wonder about the rationale behind the current administration's economic policies. The White House says they are pro growth on the economy; however, their actions are currently speaking louder than their words. They claim to want to help small businesses; however, they will not clearly define the rules by which they must play. Small businesses will find it difficult to expand when they don't know if they will be hit in the future with new taxes and regulations. In the midst of healthcare reform and cap and trade legislation, there could be a myriad of new taxes and fines that will sack the economy and, most importantly, small businesses. The Federal Reserve has continued to let the value of the dollar slide which will invariably lead to inflation. The anticipated announcement today that Bernanke and company will maintain the federal funds rate and discount window at the current low levels shows us that it is targeting the unemployment numbers. While this is important, the Fed’s inability to tighten the money supply could easily lead to asset bubbles as we are seeing in the increasing price of gold and crude oil. They seem to be forgetting that an increase in commodity prices is, in fact, a tax on the people through higher gas prices, etc. that will stifle economic growth.

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