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The Federal Reserve and the U.S. government helped the U.S. economy avert implosion during the worst days of the great recession in 2008 and 2009. But, with the benefit of hindsight and seeing the situation we're in now, it wasn't enough.

There are ongoing weaknesses in the economy and a continued nervousness about what will happen next. Perhaps this is partly a reflection of a faster-moving, more global economy, one fueled in heavy doses by technological innovation. But it also reflects a bigger truth, one that may counter many economists' beliefs, namely that government can have a major and positive impact on economic growth.

The financial crisis was the likes of which we had not seen since the Great Depression. Home prices collapsed partly because of a rising interest rate environment and sub-standard underwriting and securitization of loans. Many homeowners defaulted on their mortgages. As defaults increased, credits markets began to seize. The contagion spread, culminating with the collapse of Lehman Brothers. TARP helped to re-capitalize the banks, while the Fed cut interest rates, heading off a larger catastrophe that might have also included the fall of AIG.

The Fed's actions saved that major financial institution. Still the economy had been scarred.

Fiscal and monetary policy worked together to start a rebound. In February of 2009, President Obama signed the American Investment and Recovery Act. The $787 billion Act's purpose was to stimulate the economy and create jobs. The Fed on the other hand, cut interest from around 5% in December of 2007 to zero by January of 2009. It also embarked on its first round of quantitative easing.

As time passed the burden of handling the economic recovery began to fall more and more on the Fed. The focus of the new administration shifted from the economy to healthcare reform. President Obama signed the Affordable Care Act into law on March 23, 2010. The economy was stagnating and the first round of QE and interest rate cuts by the Fed was not having the desire effect. The effects of the stimulus began to fade.

The Fed undertook a new round of QE nicknamed QE2. In November 2010, the U.S. Congress had a massive overhaul with the Democrats losing the majority in the House. Budget deficits became the new mantra of the Republicans, leading to gridlock and government shut-downs.

The Fed had to ride in again to set things right: it kept rates low and tried programs such as Operation Twist and eventually QE3. Its efforts represented nearly every major resource at its disposal.

While this was happening, there were seismic structural shifts in the U.S. economy. The rise of technology and emerging economies meant the loss of jobs. Corporations focused on making their balance sheets healthy. Balance Sheets ballooned from $800 billion in 2007 to $1.8 trillion in 2015.

Corporate buy backs soared back to near record levels. With revenue growth languishing, the largest corporations started these repurchases to boost earnings growth. They had already cut capital expenditures and costs to the bone. The only way left to satisfy shareholders was to repurchase shares with cash on hand, or borrow at near zero interest rates to finance such purchases.

The Great Recession meant the loss of jobs, but perhaps more importantly left people feeling less secure about their jobs. If some of the world's largest financial institutions and major manufacturers could go out of business or nearly so once, it could happen again. People are now working later in life, while younger workers continue to struggle to find jobs.

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Perhaps this would have happened anyway as the U.S. population ages. Regardless, since 2000, jobs in the 55 and over age group have increased by 10.5 million, while jobs in the 16-54 age group have decreased by 5.0 million.

Perhaps in retrospect, the stimulus package was not sufficient. It represented just 5.5% of the U.S.'s $14.4 trillion GDP in 2009. China's stimulus package in November of 2008 was 13% of it 4.5 trillion GDP, and its GDP growth has been a wonder, reaching 10% annually.

But continued weakness in the economy, a lack of wage increases and continued anxiety about the future, may simply highlight that the Fed should not be counted on as the sole provider of the country's economic stimulus. Government working with the private sector need to provide more tools for enabling the U.S. to achieve stronger growth. Perhaps it could begin by launching programs to upgrade the country's aging transportation infrastructure and power grid. Perhaps it could invest in technological innovations and education. Such actions would engage potentially thousands of companies and millions of workers, while addressing important needs.

The Fed recently signaled its intent to play a less involved role in economic growth by raising short-term interest rates.

Some would say that government should move to the side, as well. But the country would be better served if Washington was more involved.

Disclosure: Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.