Worthwhile Words of Caution

I posted yesterday that it is too soon to be too critical of the stimulus plan, but David Brooks has some good words of caution today.  Politics is a messy game and compromises are often required.  But, as critical as the stimulus package is, burdening it with Democratic agenda items that have been desired but unfunded for many years is not helpful to the task at hand – no matter how worthy they may be.

The world leaders assembled at Davos are also concerned about the inflationary impacts of a bill bloated with spending that is not exclusively stimulus in nature.  While deflation is the serious near-term threat, high inflation and US dollar devaluation remain longer term concerns.  World leaders, and David Brooks in his column, are worried that there is no clear exit strategy in the current spending plan.

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