More bailouts on the way

Cris Romer wants to bail out California, and call it a stimulus. ABC has her confession. How many rounds of bailouts will we need? Each bailout insures a compliant Fed. If the Kelly trades continue to inflate they earn more than any gain from consumption; but very fast in the collapse. So Congress pushes the Fed, the Fed creates increasing deeper supply chains for Kelly trade, the most decorrelated assets in far places and future times are traded for dollars. The dollar price of foreign assets, including oil, rises as traders park dollars.

So, a nugget of low entropy, an accommodative Fed, has been captured and coded to the constraint. Precisely what intelligent economies do. Congress will be more directly bound by the oil constraint, and California government will have to reform.