[bubbleRefuge]

Modern money is created by keystrokes[1]. We(the US) are no longer on the gold standard(a good thing). In order to have conditions for economic growth(say GDP growth) to occur aggregate income must increase. There are only two possible drivers: Government goes into debt or the private sector goes into debt where debt = spending more than ones income. If government policy makers were to use fiscal policy based economic models that paid closer attention to aggregate debt and aggregate income balances we could have much smoother business cycle and avoid deep recessions where the private sector wants to deleverage. The only thing to fear is inflation and we have never truly sniffed demand pull inflation in the US ever. The 80's was supply shock petroleum based inflation.

The Federal government needs to put its foot on the accelerator and not the brakes but the politicians don't know where the accelerator is.

[1] http://neweconomicperspectives.org/2012/03/where-did-the-fed...