With its regulatory overhaul of the U.S. financial system, the Obama administration has granted the federal government new powers to take over systemically important businesses, but has done so in a way that may well mask a potentially dangerous drift toward American state capitalism.

It took the statisticians of the National Bureau of Economic Research almost a year to confirm what the rest of us already knew, that the US registered a significant decline in economic activity, thus officially entering a period of recession.  While I am pleased that the members of NBER take their duties seriously, thereby ensuring that they don’t leap to any hasty conclusions, I only wish that similar moderation could be displayed by their colleagues at the Fed and the Treasury.

Selling stuff you bought with borrowed money is a process that’s mostly been confined to the financial markets in 2008. But now we see the behavior migrating into the economy. At the household level, a collective sense of thrift is beginning to set in. People are selling what they don’t need to raise cash.