[Professor S]

I think monetary stimulus is an effective way to "plug the hole" in a sinking ship, but I don't believe it has ever proven an effective means to spur real growth, and right now we are 3 years in our "recovery". There needs to be a promise of prosperity, not just cheap money to spur lending and spending.

Spending pushes money around. While this serves a purpose, its a terrible scenario for basing an economy 3 years after a crash. Savings and investment grow wealth, and these rates and cheap money aren't incentivizing either, IMO.

As for inflation, I understand that most economists only measure CPI-U and not CPI (due to volatile markets included in CPI), but that doesn't make them any less impactful. Also, costs to producers have skyrocketed, and while market forces are keeping prices stable now, well, I am not as confident as you that inflation is only a long term concern. I hope you are right, but right now I'm fearing at least a mild double-dip because our economic growth is being consumed by increased costs at almost every level of production and consumption. God help us if the rest of the Western world manages to stabilize their debt and currency...

EDIT - To not overstate my case: I'm glad we handled TARP and QE the way that we did, but IMO its time to turn off the spicket and allow the economy to find it's own equilibrium. As you said, uncertainty is a huge issue, and uncertainty is caused by unstable markets AND populist government interference.