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Comment by A4ET8a8uTh0 | Hacker News Reader

It is weird for me to read this. On the surface, it is factually correct, but I am not absolutely certain the conclusions drawn are valid.

Your initial paragraph seeks to address point raised by others that FED is running out of ammunition and you list of Japan as an example with other pointing out the price Japan paid for that pollicy.

I suppose FED could buy all US equities on national credit card ( and if you think about it, something similar to it happened only few months ago ), but do you think it is a prudent move?

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Prudent move? It's the only move. If it's either that or a recession, then they will do it, consequences be damned.

I disagree. You can maybe delay the inevitable correction, but it is going to come. And after the sugar rush of easy credit ends, the headache will be that much worse.

Would it not be better to face some of that pain now?

Not in an election year.

Trump will not let the recession occur, because he's so afraid of losing.

Maybe that is part of the problem. We imbue our leaders with a belief that their will alone is sufficient to stem the tide forgetting that they are only human.

This is the point of the Fed being independent - so that they can ignore Trump's tweets and do what they think the economy actually needs.

Now, they have recently done basically what Trump asks. Are they succumbing to Trump's pressure, or is Trump asking them to do what actually is the right thing?

They are independent, but not imune to pressure from a powerful person who doesn't recognize any boundaries to achieve his personal goals.

Sure, but it's also a matter of when. If you can delay it for a few decades, that's going to be enough for a lot of people to retire.

The US could just cut interest rates whenever the stock market goes down. There's no real limit to how low they can go, and as long as the investors understand that the Fed is backstopping them they'll contribute in pumping it up.

This is a problem that the Fed created for itself. In the 20th century, a recession was a normal thing to be expected, even textbooks said this. It seems now that we have a whole generation that is afraid of going through a recession and apparently will do almost anything to avoid one. The Fed created this problem by manipulating the markets to avoid recessions when they should be occurring. Now it seems that the only thing guaranteed is that the country will burst when the next inevitable one happens.

Recessions are not caused by stocks going down in value. Stocks going down in value is an indicator or symptom of a recession. In the same manner, a Coronavirus infection is not caused by a fever.

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