Tuesday, March 8, 2011

What Larry Summers Views as Normal

“The American economy has a feeling of normal as I talk to you today that was completely absent two years ago in March of 2009, and that is a very substantial achievement,” said Larry Summers during a speech delivered on Monday, before the Greater Boston Chamber of Commerce.

Let's look at Larry Summer's normal:

Oil is over $100 per barrel.

Gold is over $1400 an ounce.

The Fed is pumping hundreds of billions of dollars into the economy via something called QE2.

Most of the money being pumped in is being removed from the system by banks when they add it to their excess reserves with the Fed.

Many state and city governments are teetering on the edge of bankruptcy.

The Federal government has a completely out of control budget that will explode at some future point.

Consumer prices are starting to tick up for food, clothing and gasoline.

This is what Larry Summers calls normal.

No wonder he sleeps so easily, to him a warrior heading toward him with machete looks like a butler carrying a butter knife with which he can butter another bread roll .

Boston's WBUR radio will broadcast Summer's entire speech on Sunday at 8:00 P.M. You can listen to it over the internet, here.


  1. It's almost as if he never learned anything about "The Great Moderation."

  2. Gawd, he has got to be the biggest effing economic moron.

  3. required listening for insomniacs, i guess.

  4. Too be honest, things being run into the ground is normal for him.

  5. Bob:

    Where do you get the info that QE2 is going into excess reserves? My guess is that the prime dealers are investing it into financial assets.