from Scott Grannis at The Calafia Beach Pundit, Why the Global Gloom:
Despite all the gloom out there, and despite all the disappointment, there is reason to be optimistic. If we’ve learned anything in the current recovery it’s that 1) fiscal stimulus (e.g., the ARRA) doesn’t work and 2) monetary stimulus (e.g., QE and zero interest rates) don’t work either. Government policymakers cannot conjure up prosperity by spending more money or cutting interest rates. What’s needed is for government to get out of the way and boost incentives for the private sector to jump-start the economy. That means lowering marginal tax rates, simplifying tax codes, eliminating subsidies, and reducing regulatory burdens.
This is not rocket science. The entire world has witnessed massive, almost laboratory-type experiments in fiscal and monetary stimulus fail to deliver the promised results. There’s nothing left to try except what is most likely to work. Politicians need to hand the reins over to the private sector and market forces and step aside. The world’s stock markets seem to be saying that this is a real possibility that may come to fruition within the foreseeable future.