A Call to Fed Action

An economy mired in stagnation
From a crisis of hypothecation
Then turned to the Fed
And fitfully said:
"Only you can provide our salvation!"

With a glance in its slim bag of tricks,
Said the Fed: "We can certainly fix
Your moribund state
By dropping the rate
From zero-point-two-five to nix."

In a story that inspired much scorn from the financial blogosphere, The Wall Street Journal's Jon Hilsenrath writes that "Federal Reserve officials, impatient with the economy's sluggish growth and high unemployment, are moving closer to taking new steps to spur activity and hiring." The only problem is that, even by the admission of a journalist well connected with the aforementioned Fed officials, the potential steps are not likely to have much effect. For example:

Determined to keep trying to get the economy going without causing inflation, the Fed is exploring other novel measures. One idea mentioned by Mr. Bernanke in his testimony would be to use a facility the Fed calls its discount window to provide cheap credit directly to banks that make new business or consumer loans. But it isn't clear such a program would do much good when banks already have ample access to cheap credit and this kind of program doesn't appear to be winning favor at the moment.

I'm afraid that the time for pushing on a string is past, and the hour for fiscal and structural changes is here, if only the Congress would grasp it.