Wood Says It Ain't Gonna Work

It Ain't Gonna Work III

Here is a snippet:

• ...In any event, in the wake of this news the equity markets surged, the dollar sold off and commodities rallied. Hip, Hip, Hurray. Hip, Hip, Hurray. It’s 2007 all over again, or is it?
  
  In my opinion, this re-inflation effort is ultimately not going to work any better than any of the previous efforts. The technical damage that has been done over the last couple of years is not something that can be fixed by some stimulus package. The equity markets are still operating within the context of a massive secular bear market and the bounce that is currently underway is nothing more than a bear market rally. The commodity bubble is a thing of the past, even though this counter trend bounce still likely has further to run and the decline in the dollar was totally expected based on my cycles work. So, at this time I’m not seeing anything out of the ordinary or that wasn’t expected based on my cyclical work.
  
  Also, with the average American consumer tapped out, ask yourself a common sense question. How, are these bailout plans going to stimulate aggregate demand? Did the balance in your checking account increase because of any of these efforts? Did the liability side of your balance sheet change? Do you suddenly feel the urge to go borrow more money or to make a major purchase? As I see it, these efforts are not reaching the consumer and therefore, this is not going to stimulate demand. What it is doing is saving the financial institutions that made the bad loans. I feel that not only should the over-indebted consumer pay the price, but so should the responsible institution for making the bad loans. Printing money out of thin air and/or using tax payer dollars to bail out financial institutions that made poor business decisions to make loans to high risk consumers is wrong and will not ultimately fix the problem. At best, this may temporarily re-inflate equities and commodities.