Doni, I really had hard time understanding what you were saying and i still have a PH.D. in economics and have passed my dr.'s exams in Mathematics both in Berkeley. In fact, someone mentiond Euler today and I have used many theorems of his in papers I have written. Bernanke is one of the few experts about the depression that this country witmessed in the thirties and what were the policies of the Fed that led to this situation. The profession now agrees that the Hoover administation blew it by restricting the money supply depriving the econoy from the required liquitidy. Bernanke did not do that although the profession is divided on whether the Fed should have rescued the banks that were too big to fail. This appears to be ironic since both Democratic as well as Republican administrations allowed all these banks to assume their present dimentions by engaging in mergers and aquisitions ignoring, thereby, all the consequences of allowing them to do so. But then Wall street has more power and lobbists than you or I. A full treatment of the problem would require to bring in balance of payments considerations but then the plain English would become unreadable in thios forum.At any rate this is water under the bridge and frankly if they had not done this the whole financial system would have collapsed. Therefore, the choice really was between two bad options and they picked the least damaging.

If you are concerned about the inflation, for the time being there is not any fear of that with the utilization capacity of the country running about 70% and Bernanke has plans for that and also adequate time to take care of this future problem. As a matter of fact the probvlem now is the glut of savings around the world. Looking at the US savings right now that are deposited in offshore insitutions of financial intermediation they amout to, hold your breath, 30 trillion dollars and all this money is not invested in productive activities. Some of the reasons why this is so was given byALVE today but they are many others and I can mention many ways of how this can be done. What is interesting about this is that they claim that they do because of taxes. This is a red herring.

All of us have opinions about all these things but this reflects ideologies and not fact. And i tried very hard not to express mine.