Bank Failures

There is a lot of chatter about "needing to cut deficits and raise interest rates" because financial markets "need it".

Funny. Here's what I consider to be the real situation (from The Big Picture blog):

Click to Enlarge
The reality is that the economy is fragile. Banks are still failing at a near peak rate. In short, the patient is still in intensive care and the rabble outside is yelling for the patient to be unplugged from life support because they are worried that the critically ill patient will soon rise from the deathbed and become The Hulk and start raging around tearing things up. Give me a break!

It will take another year or two of gentle care before the recovery is strong enough to remove the stimulus and artificially low interest rates. Talk of "inflation" and "deficits" is counter-productive.