Stimulus Success & Market Recovery?
I've been mostly lurking on here, though I did introduce myself about a year ago and I enjoy reading the collective wisdom. Like everyone else, my retirement has taken a hit and as I try to understand the causes and proposed cures for this mess, I find one question keeps bugging me. So I thought I'd run it by you all and see what you think.
Obviously, everyone wants the economy/market to recover. By recover, I assume that means a return to 12,000 - 14,000. But since *that* market was a result of consumption via obscene amounts of debt on credit cards, liar loans, unaffordable mortgages that had yet to reset, and more...IOW a house of cards...how can we reasonably expect to get back to a robust economy anytime soon? Is the expectation that, when/if the world economy finally "turns around", consumers can return to profligate, unsustainable consumption on easy credit and all will be well again? And wouldn't that put us right back where we are now?
Various media reports suggest that at some point, regulation will return to US banking and the markets...IMO, that would be a good thing, but then will a regulated market and banking industry be able to return to previous highs in anything approaching a reasonable length of time (like, our lifetimes)? If the answer is "no", then would even the perfect stimulus package be forever considered a failure simply because the results were measured with a faulty yardstick against the old economy that was built on a house of cards?
Hope this question isn't too much of a bummer, but it's been on my mind lately. What do you think?