Stop Me Before I Vote Again

"In my view, if policymakers insist on waiting until the level of real activity has plainly and substantially returned to normal -- and the economy has returned to self-sustaining trend growth -- they will almost certainly have waited too long.

A complication is the large volume of banking system reserves created by the nontraditional policy responses. There is a risk, of much debated magnitude, that the unusually high level of reserves, along with substantial liquid assets of the banking system, could fuel an unanticipated, excessive surge in lending.

Predicting the conversion of excess reserves into credit is more difficult to judge due to the changes in the credit channel."

Them's the words of black Irish Kevin Warsh, shown at left, Bush-appointed Fed governor, formerly among the boy emperor's council of economic witch doctors.

Admittedly, he's one of the more ghoulish brains among the credit flow federales -- here he is, for example, quoting the unspeakable Daniel Patrick Moynihan. But he's not the only ghoul. In fact the joint is full of 'em.

"A rapid exit from accommodative policy" -- oh, the pain, the pain, as Prof Smith was wont to say. This perma-hawk button-pushing bunch at the Fed -- credit doom hangs like a mushroom cloud over my daydreams. Is it to be our near tomorrow?

By the way -- before joining the Bush hose-and-close squadron, our mean Mr. Warsh was a decade-long member and leader of the Mergers & Acquisitions Department of -- Morgan Stanley & Co.