Why Doesn’t The Fed Lend Each Of Us $10 million?

Wouldn’t that be a good way to jump start the economy?

Sheila Baer, chairman of the Federal Deposit Insurance Corp. during the Crash of 2008, was a lonely voice of sanity at that time. In 2012, she wrote an article for The Washington Post poking fun at the Fed for what it had been doing. It was entitled “Fix Inequality With $10 Million Loans For Everyone.”

Why not, she said, expand the Fed’s current welfare system for banks, financial firms and wealthy investors to everyone else? Why not, in short, create sufficient new money to lend every U.S. household $10 million at zero interest rates?

You might object: How will we pay the money back? But don’t worry. You won’t spend this money. You will just invest it.