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Time to reload for the next crisis

Commentary: Deficit must be tamed to restore safety margin for borrowing

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Long-term interest rates stayed under control this week, but barely. The economy is changing for the better: this may be another false recovery, but as they have gone, this one is by far the most broad and sound since the show stopped in 2008. Last week I questioned the report of a quarter-million-jobs gained in February. Should not have, as confirming data have arrived. The National Federation of Independent Business' monthly survey of small-business owners reversed a downtrend, still in recession but brightening in February. Retail sales outperformed all guesses by miles, jumping 1.1 percent. And new claims for unemployment insurance have fallen to a lower range, about 340,000 weekly, not far from normal. Despite that strength, the Treasury this week easily auctioned $21 billion in new 10-year notes and $13 billion in 30-year bonds. Markets had two supports: faith that the Fed will stay easy, and demand from overseas. Europe and Japan owe their daily survival to promises ...