Straying out of territory for a moment........

...I have to say that this post from Paul Krugman absolutely nails the asininity of the US Treasury (combined with Fed). Krugman shoots down the latest plan in flames with the help of mega-respected econoblog Calculated Risk. Quite right, too. The Krugman post is the one mentioned here because it is short, accessible and right on the button. Go read, and while you're at it read this Krugman pearl from the weekend.

I'm not saying that Krugman has all the answers. I am saying that he knows economic bullshit when he sees it.

Chart of the Day

From Brad Setser's blog

File this one under "H" for "holy crap!".

Meanwhile, I asked this question earlier today:

When a gov't cuts a cheque for U$85Bn, where do the funds come from? Seriously, I've been thinking about this since last night and I've come to the conclusion that I don't have a clue.

Well happily, Felix Salmon over at 'Market Movers has answered, and here's the link which includes;

"The real answer, however, is that there won't be any $85 billion check. AIG will draw down this liquidity facility only as and when it needs to, and indeed there's a substantial chance that yada yada go see the rest here....."

Moral of the story: If you don't know, ask.