When depression economics prevails, the usual rules of economic policy no longer apply: virtue becomes vice, caution is risky and prudence is folly.

Man, I would like a dollar for every time I’m told the old rules no longer apply because of **insert paradigm shift here**.

Those old rules never seem to be able to apply for long, makes you wonder what sort of rules they were to begin with, finding it so difficult to apply and all. Then again, now we have new rules, how long will they apply for?

All indications are that the new administration will offer a major stimulus package. My own back-of-the-envelope calculations say that the package should be huge, on the order of $600 billion.

So the question becomes, will the Obama people dare to propose something on that scale?

Well the banks got their handout, presumably it’s only fair that the rest of the nation gets something. Since none of this money even exists, why not go nuts? I mean, something is keeping the US dollar afloat (no one can explain what exactly) so might as well ride it as long as possible. The US debt is now so big that no one can even visualise a workable payments plan, so ultimately the tsunami of inflation is already coiled and ready to wash all debts clean. In the meantime, stimulate away.