A couple of days ago, the Federal Reserve announced that it is spending $500 billion on ‘commercial paper’. That’s short-term loans made by banks and businesses to get working capital. While this is a good thing for freeing up the credit market and getting cash moving around again, it barely made the news!!

Have we already gotten so jaded with the government handing out Trillions of dollars, that half a trillion doesn’t even get us excited anymore? This is 2/3rds the amount of the initial bailout bill, that the House and Senate had to debate and vote over for a week! Now the Fed can just roll out the dumpsters of money, call “Soooieee!! Sooieee Bank!” and wait for all the little companies to come feed.

We’ve moved from a state of panic and indecision to a state of near indifference. I’m not sure if that’s because no one really knows what to do, or everyone feels that there’s nothing they can do for the situation.  Either way, it’s definitely an interesting change.

For Better or Worse

On the good side, that means Joe Public is calming down about the whole thing, and getting used to the fact that we’re in a (possibly deep) recession. Live with it. Get used to it. Life goes on.

On the bad side, it shows how little involvement in the process we either have, or think we have, to give up this early in the game. Government has basically thrown up its’ hands, and said “Well, we’ve done everything we can think of, how about you Fed?”

I’m hoping that this new infusion of cash has the desired effect of getting the flow of money going again. Something’s got to work, and hopefully soon, or this ‘economic downturn’ (can’t dare say it’s a recession or depression) will stretch out for years or decades.

My only fear is that the cure is going to be worse than the disease. We still have to pay those Trillions back someday, somehow.