http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/ Should Infrastructure Spending Be a National Priority? Forex markets are driven by the strength of national economies. Monetary policy may modify the course of Forex prices but in the end a weak economy means a weak currency and vice versa. The world economy is not doing especially well and one school of though is that the Central Banks alone are not going to be able to dig us out of the rut we are in. This school of thought promotes infrastructure spending on a massive scale as a stimulus measure. Bloomberg Business just published an article, how to pull the world economy out of its rut, in which they quote Lawrence Summers who is the stimulus guy. In Europe and Japan, interest rates have turned negative, something long thought impossible. In the U.S., workers’ productivity is improving at the feeblest five-year rate since 1982. China is a confusing welter of slumping growth and asset bubbles. Federal Reserve Chair Janet Yellen practices the central banker’s art of draining the drama from any situation. She insists that conditions are returning to normal, albeit slowly. Lawrence Summers, the Harvard economist who almost got Yellen’s job, has no patience for such patience. Since losing out to Yellen in 2013, he’s been jetting around the world-from Santiago to St. Louis to Florence, Italy-to argue that the world economy is in much worse shape than central bankers understand. Focusing on monetary policy alone, he says, they’re doomed to fall short of reviving growth. They need to reach out to the governments they work for, he argues, and insist on strong fiscal stimulus in the form of infrastructure spending and the like. As the article notes, the jury is still out on this. Nevertheless let’s take a look. Should infrastructure spending be a national priority and if the US and other large economies do this how will it affect the Forex markets?

1. Should Infrastructure Spending
Be a National Priority?
By www.ForexConspiracyReport.com

2. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Forex markets are driven by the
strength of national economies.

3. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Monetary policy may modify the
course of Forex prices but in the
end a weak economy means a
weak currency and vice versa.

4. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
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5. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
The world economy is not doing
especially well and one school of
thought is that the Central Banks
alone are not going to be able to
dig us out of the rut we are in.

6. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
This school of thought promotes
infrastructure spending on a
massive scale as a stimulus
measure.

7. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Bloomberg Business just
published an article, how to pull
the world economy out of its
rut, in which they quote
Lawrence Summers who is the
stimulus guy.

8. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
In Europe and Japan, interest
rates have turned negative,
something long thought
impossible. In the U.S., workers’
productivity is improving at the
feeblest five-year rate since
1982.

9. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
China is a confusing welter of
slumping growth and asset
bubbles.

10. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Federal Reserve Chair Janet
Yellen practices the central
banker’s art of draining the drama
from any situation.

11. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
She insists that conditions are
returning to normal, albeit slowly.

12. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Lawrence Summers, the Harvard
economist who almost got
Yellen’s job, has no patience for
such patience.

13. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Since losing out to Yellen in 2013,
he’s been jetting around the
world-from Santiago to St. Louis
to Florence, Italy-to argue that
the world economy is in much
worse shape than central
bankers understand.

14. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Focusing on monetary policy
alone, he says, they’re doomed
to fall short of reviving growth.

15. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
They need to reach out to the
governments they work for, he
argues, and insist on strong fiscal
stimulus in the form of
infrastructure spending and the
like.

16. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
As the article notes, the jury is
still out on this.

17. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Nevertheless let’s take a look.
Should infrastructure spending be
a national priority and if the US
and other large economies do
this how will it affect the Forex
markets?

18. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
How to Fight Secular
Stagnation

19. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Secular stagnation is a situation
of little or no economic growth on
a prolonged basis in a market
driven economy.

20. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
This was the case during the
Great Depression and the answer
was to create public works
programs.

21. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
People went back to work, got
paychecks and paid taxes on
their earnings.

22. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Money started moving through
the economy again.

23. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
The short version of today’s
debate is that the U.S. should
invest in fixing its aging
infrastructure and this would help
the economy and coincidentally
the US dollar.

24. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Opponents such as the Cato
Institute argue that all of this
about U.S. Secular
Stagnation is simply an excuse
for more big government. The link
is to their long article.

25. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
When Does Fiscal
Stimulus Work?

26. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
The Economist addresses this
question in their article, When
Does Fiscal Stimulus Work?

27. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
They wrote this in 2010 before
much of the current recovery had
happened but the arguments
apply today.

28. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
A country committed to stimulus
will take care to prepare to use
stimulus.

29. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
It will construct a system of
automatic stabilizers that provide
immediate countercyclical aid as
an economy deteriorates.

30. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
It may have a backlog of needed
infrastructure projects at the
ready, which can be rushed into
action as conditions warrant.

31. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
A country generally skeptical of
stimulus, on the other hand, will
reach for it in an emergency and
find that it is unprepared.

32. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Automatic stabilizers will be too
small and will require constant
Congressional maintenance.

33. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Too few projects will be shovel-
ready. The need to legislate will
lead to inclusion of pork items
that aren’t particularly simulative.

34. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Stimulus will be less targeted,
timely, and effective as a result.

35. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
The point in the USA is that we
have a national highway system
including bridges in need of
repair and upgrades.

36. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
Infrastructure spending is useful
on two fronts.

37. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
It puts people to work and if the
infrastructure in question is
needed, the repairs are good for
the economy by making the
whole system more efficient
again.

38. http://www.forexconspiracyreport.com/should-infrastructure-spending-be-a-national-priority/
If infrastructure = pork barrel
projects, infrastructure spending
should not be a national priority.