After five years of aggressive Federal Reserve and government intervention in our monetary and financial systems, it's time to ask: Where are we?
The "plan," such as it has been, is to let future growth sweep everything under the rug. To print some money, close their eyes, cross their fingers, and hope for the best.
On that, I give them an "A" for wishful thinking - a nd an "F" for actual results.
For the big banks, the plan has involved giving them free money so that they can be "healthy." This has been conducted via direct (TARP, etc.) and semi-direct bailouts (such as offering them money at zero percent and then paying them 0.25% for stashing that same money back at the Fed), and indirectly via telegraphing future market interventions so that the big banks could 'front run' those moves to make virtually risk-free money.
This has been fabulously lucrative for the big banks that are in the inner circle. As we've noted somewhat monotonously, the big banks enjoy "win ratios" on their trading activities that are, well, implausible at best. ...