Some of the ideas to jump start the anemic U.S. economy-for that matter the global economy-are getting ludicrous. Yesterday I heard the usually sane and sober Barton Biggs, managing partner of Traxis Partners, suggest on Bloomberg TV that the Fed go out and buy single-family homes. Since that's where 50% to 60% of where the average American's net worth resides and also is the locus of our economic maladies, Biggs reasons it would have a huge effect on consumer confidence and consumer spending. I wouldn't have expected even Paul Krugman to concoct such a scheme.

Whose homes would the Fed buy? Relatives of members of Congress who can't get out from under their own submerged mortgages?

Biggs also thought it would be nice if the Fed bought mortgage-backed securities. That's a more realistic option, but it has already been used with little success.
Other attempts to manipulate the housing market are equally amusing. Bank of America reportedly is donating foreclosed homes to charity and then demolishing them. Apparently, many think the housing market is such a basket case that they can't let price discovery take place on its own, fearing we'd discover what homes are really worth and that would trigger another deep recession.

Before the Fed embarks on some new round of stimulative monetary policy, they might want to ask what QE2 accomplished. Very little is my answer. As the perceptive Randall Forsyth of Barron's has noted, the wealthy got higher stock prices; they and everyone else got higher commodity prices. That's great if you are a corn farmer, an oilman or a copper manufacturer, but it is a big drag on the rest of the economy.

Especially if you are a Walmart shopper. When gas prices peaked in late April, Walmart's CEO reported that his sales fell off a cliff. Fed chairman Ben Bernanke should be smart enough to realize that transferring money from Walmart and their customers to foreign oil producers is not going to improve the situation.

The absence of consumer demand is what's prompting businesses not to hire unemployed workers. As long as this condition persists, growth will remain subpar. It's clear that the process of deleveraging will take at least several more years to run its course. In the meantime, everything from stimulus spending to tax cuts to absurdly loose monetary policy appears ineffectual.

The one bright spot is exports, which have accounted for nearly half the U.S. growth rate since the recovery began. Now with a global slowdown gathering steam in China and Brazil as well as comatose Europe, exports look threatened as well.

Academic experts are putting the odds of another recession at between 20% and 50%. The good news, in my view, is that we may already be in a "growth recession," where growth slows to about 1% and unemployment ticks up, and we may about to limp our way out of it. In fact, we could have already experienced a real recession and learn about it in three months. All it would take is a small revision to economic data.