Hi, Glenn- Agree. I've also seen articles that suggest that QE2 has not had that much of a positive effect on the economy beyond what has already been happening, so in that view it's a potentially big loos for relatively little possible gain. But I think your basic insight about always living on the edge of a cliff gets to the heart of it; if not this particular cliff, then some other one. Perhaps one with a better view if you look to the left on your way down?
I read an interesting piece the other day about the lopsided distribution of wealth, which as you know has reached 1929 level highs and i think is probably headed towards 19th century (i.e., Vanderbilts to sweatshops). It's a product of two key factors: the Fed has kept interest rates low, by historic standards, for the last 20 years, and capital gains are lightly taxed at 15%. That means there's a lot of easy money out there to speculate with, so we get bubble after bubble. While many people get hurt when each one deflates, enough people have been smart enough to get out in time with lightly-taxed speculative profits to produce the current results. You could perhaps argue they deserve to be rewarded for their smarts, except that I suspect pure dumb (adjective intended) luck was also in play, and more seriously such activity is non-productive, i.e. it adds nothing to the economic wealth of the society. At least the Vanderbilts gave us the railroads, and the Rockefellers gave us the oil industry. Maybe "gave" isn't quite the right word, but you get the point
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