Daily Databite: Stealth Stimmy
Checking in on one theory of stealth stimuli
Good morning again. It’s not one, but two, Databites. The second one is a bonus one because it’s about baseball and a pretty remarkable thing, at that.
Enjoy this and then enjoy the rest of your day.
Random Walk has variously speculated as to why economic pain has taken longer to arrive than expected (including yesterday). One reason (other than the most obvious reason that I’m simply wrong about the forthcoming pain) is the “stealth stimulus.”
It’s a bit of a squishy, self-serving concept, but the “stealth stimulus” refers to the the not-slow, but very-steady increase of government spending that generates “growth” . . . despite the Fed’s best efforts to do the opposite of that. In other words, try as it might to slow the economy down by “killing demand,” there is one demand that the Fed can’t kill, and that’s Uncle Sam.
One prominent category of stealth stimulus is the deluge of interest payments that said Uncle must pay now that’s borrowing …
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