Inflationists have always maintained that the Fed would do whatever it takes to prevent the economy from slipping into deflation. How seemingly fortuitous, then, that someone deserving of the nickname 'Helicopter Ben' was at the helm of the Federal Reserve when it came time to push monetary expansion to its theoretical limit. Recall that the idea behind a helicopter rescue of the financial system was that money would be shoveled out of helicopters, showering $100 bills onto creditors and debtors who'd gotten into dire trouble. Well, that's pretty much what the Fed has been doing these days -- multiplied by a billion -- in concert with the central banks of Europe. If you are a card-carrying banker, it would seem there is almost no limit to the amount of no-questions-asked cash the Fed and its friends have placed at your disposal. It is reminiscent of the days, in the early 1990s, when the Resolution Trust Corp was charged with bailing out the S&Ls. Back then, just about anyone wearing a suit and tie could walk into an RTC office and come away with the deed to millions of dollars worth of someone else's foreclosed property. ( I experienced this first-hand, having worked for a hedge fund operator who did it until a string of regulatory infractions caught up with him and ended his career in the securities business.) For a few fabulous months, the RTC was effectively giving away assets to anyone who merely looked respectable. Now the Fed is trying to repeat the tactic, providing practically unlimited borrowing power to banks while they are still able to affect the appearance of creditworthiness. Criminally Oblivious This charade may be fooling the fund managers who continue to prop up the stock market with Other People's Money, but it hasn't fooled the credit markets,
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