"The most aggressive fiscal and monetary policies in history" worked, argues West Chester-based Moody's Economy.com analyst Mark Zandi and ex-Federal Reserve vice chairman Alan Blinder, now of Princeton University, in this 30-page review, "How the Great Recession Was Brought to an End."
Despite "critics calling them misguided, ineffective, or both," and the fact "more government support may [still] be needed," Federal Reserve Chairman Ben Bernanke's "quantitative easing" of the money supply, Obama Treasury secretary Timothy Geithner's bank "stress tests" designed to force lenders to set aside enough reserves to cover their losses, and the Bush Administration's Targeted Asset Relief Program to temporarily finance failing banks, automakers and the occasional big insurer have had a "huge" impact in saving nearly 6 million jobs and preventing a ruinous deflation and negative growth, Blinder and Zandi argue.
Zandi also credits the Obama and Democratic Congressional stimulus programs with "very substantial" effects, creating another 2.7 million jobs.
But if the economy's been cured, why are so many people still out of work? asks Zandi's colleague Michael Bratus in his article, "You Call This a Recovery?"