"the financial crisis, and in particular the popping of the housing bubble, had two big effects on spending. One was that housing investment plunged from well-above-normal to well-below-normal levels. The other was that consumers suddenly increased their savings.
Put these together and you have a negative shock on the order of 6 percent of GDP.
Against this you had a stimulus bill of $800 billion — except $100 billion of that was AMT extension that was going to happen anyway, another $200 billion was other tax cuts of dubious effectiveness, so you were left with $500 billion of spending, spread over more than 2 years — maybe 1.5 percent of GDP or less.
It just wasn’t big enough to do the job."
I'll settle for that:
A four fold two small stim-u-less
Thanx Barry Tim and Larry
