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There is currently an enormous need for productive investment in infrastructure in the USA and the world in general. This includes renewable power and the electrification of rail transport. The problem is that, to be effective, the construction of electrical power infrastructure needs to be done at no or very low interest rates and none of those with money to invest find that attractive - this despite the continuing ZIRP. One possibility would be a public offering of bonds to finance wind farms with the explicit backing of the government for principal and interest at the minimum rate that would see them sold - target range of 2-3%. There are lots of retirees who are afraid to expose their savings to risk and can only get a fraction of a percent return on a guaranteed deposit. I see the problem as political. Such a program would benefit all from reducing GHGs and capping electricity prices to stimulating employment, but it undercuts the interests of the fossil fuel industry, and thus is very difficult to enact.

The bottom line problem is that we need to downsize the financial sector. The effect of its operations are to impose the private sector equivalent of a VAT, likely over 20%, on a huge range of activities - any thing it touches.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Aug 16th, 2014 at 11:08:30 AM EST
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