It won't work this time, too much debt, consumers are tapped

comment:

The Keynesians are counting on a consumer led recovery, but the consumer is too debt laden to cooperate.

Published on Zero Hedge (http://www.zerohedge.com)

Home > David Stockman's Non-Recovery Part 4: The Bernanke Bubble

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David Stockman's Non-Recovery Part 4: The Bernanke Bubble

By Tyler Durden

Created 06/22/2013 - 10:57

From Part 1's post-2009 faux prosperity [1] to Part 2's detailed analysis of the "wholy unnatural" recovery [2] to the discussion of the "recovery living on borrowed time" in Part 3 [3] (of this 5-part series), David Stockman's new book 'The Great Deformation" then takes on the holiest of holies - The Fed's Potemkin village. The long-standing Wall Street mantra held that the American consumer is endlessly resilient and always able to bounce back into the malls. In truth, however, that was just another way of saying that consumers were willing to spend all they could borrow. That was the essence of Keynesian policy, and to accept the current situation as benign is also to deny that interest rates will ever normalize. The implication is that Bernanke has invented the free lunch after all - zero rates forever. Implicitly, then, Wall Street economists are financial repression deniers.

• Ben Bernanke
• Foreclosures
• Gross Domestic Product
• Main Street
• Personal Income
• Reality
• recovery

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Source URL: http://www.zerohedge.com/news/2013-06-22/david-stockmans-non-recovery-part-4-bernanke-bubble

Links:
[1] http://www.zerohedge.com/news/2013-06-17/david-stockmans-non-recovery-part-1-post-2009-faux-prosperity
[2] http://www.zerohedge.com/news/2013-06-18/david-stockmans-non-recovery-part-2-crash-breadwinners-and-born-again-jobs-scam
[3] http://www.zerohedge.com/news/2013-06-19/david-stockmans-non-recovery-part-3-borrowed-recovery-borrowed-time