Lost in the financial supermarket

It seems as if we have seen an interesting turn of events this week, Bernanke has green-lighted that the FED will buy bonds for USD 300 million, thereby increasing the amount of money in the US economy. Im sure that this will mean inflation, and with inflation .. lower debt in terms of purhcasing power (since salaries will increase).. and slowly erode the Debt/Equity ratio that many corporations and households see.

In Europe, we cannot see this quick response since we have to coordinate everything.. hope we can see some response, since some reports say that the Euro-zone is showing signs of Deflation, a horrible scenario that possibly could toss the EU into a zombie-like Japanesque state - Who would want that?

So, what does this stimulus package mean.. even though I actually am a trained economist, in some sense, i believe that the stimulus is good in the short term. Why you may ask? Well, the current economic system in both the EU and the US is in absolute shambles, it was on a brink of collapse. By this is I mean that we were inches away from seeing our ordinary debit cards malfunctioning, unable to pay bills through information systems and of course not being able to fund anything without 100% cash. This scenario is now, slowly being averted by taking out new loans (debt) and printing more money (a.k.a. Quantitaive measures). Of course, we are having huge debt/equity ratios, that is we are curing the pain with more future pain, but at the same time bringing out the old inflation monster from the closet and letting it eat up pensions, salaries and debt. The debt will also be a future problem or pain to cure, once markets start functioning again.. (hopefully soon). What do I mean when I say functioning? A slow recovery toward real positive GDP growth in what used to known as the "developed" world.

I therefore highlight some of the issues that I find most interesting when comparing the EU and the US:
US: Excellent education system - the best in the world, homogenous market - same language, willingness to move
EU: Larger than the US market, culturally diverse - could pose as both a threat and a possible gold mine for coming up with new ideas, becoming more integrated.

I am becoming more and more positive towards the possible signs of a slow and painful recovery, but... well, I would want to see some more hard evidence. The auto manufacturers problems are not over (Even though German VW managed to get a profit for 2008).

In school, we have started a new course that is called "Management Control System" with a professor named Norman Sheehan. So far, it looks absolutely excellent... In the class, we had some lecturing together with a couple of shorter cases that we "solved" in class. Very rewarding style of teaching.