A few people are asking tough questions about the Fed’s insane policy of lowering short term interest rates. Perhaps the problems with the economy cannot be solved by more money, rather, “the economy, particularly in Silicon Valley, must face an even stronger dose of free-market capitalism: A shake-out that weeds out weak, money-losing companies so the survivors can become stronger and more profitable.” The easy-money policy of the 90s
made it easy for companies to expand and venture capitalists to finance too many start-ups. The subsequent bust has been more of a “business recession,’’ hitting corporations and profits much harder than consumers -- but it hasn’t gone far enough to offset the excesses.
