America is better off with a recession.

Paul Farrel from MarketWatch just posted an article advocating 17 merits for a US recession. This was pretty interesting, given that Bloomberg just released an article on the pressure for Bernanke to further cut interest rates to avoid a recession.

On Oct 1 2007, Alan Greenspan had warned that the good times were over, and that the world should prepare for a recession. He regretted his decision to exercise tax cuts in 2001 to boost investment and spending during the dot-com burst. The best solution for financial panics like this, was to wait for them to finish.

It appeared that Bernanke was pretty concerned about not letting the US economy go on a recession during his tenure, and succumbed to public pressure to cut the Fed rates , postponing the inevitable. There were rumours that 7 countries were considering abandoning the US dollar , and pessimistic views on the US economy were rampant.

I agree with Paul and Greenspan that encouraging a recession will be the right thing to do, though tough. Let the market forces adjust the effect, and the people will adjust accordingly. Stop the meaningless war which only raises more resentment and hatred among your people. Stop floating the dollar, and keep the dollar within a band. Engage the other nations in talks to restrict the capital outflows from the country. Devise policies to relieve the impact of import-based inflation from the weakened dollar. Let the housing market burst and the banks in Wall Streets to continue writing off their bad debts. Devise policies to relieve those who have lost dearly in this recession.

Be patient, and start building the economy from scratch. Encourage the nation to embrace simplicity and reduce consumption. A drop in the level of consumption does not necessary indicate a drop in standards of living. If you try too hard to postpone the inevitable, it will only strike back with a more lethal force at a later time. Raise the fed rates and let the nation goes on a recession, America.