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We know we’re supposed to buy low and sell high. But somehow, fear often stymies our better judgment.

When housing prices were going through the roof, it seemed like the laws of economics no longer applied. Corporate wheeler dealers – particularly those banks and businesses operating outside of Vermont – pulled fast ones to leverage all sorts of assets to join the bandwagon. How could they go wrong?

Well, we found out the answer to that one. The bubble burst, as bubbles always do. Now, the future looks bleak. The stock market has crashed. Retirement funds have shrunk. Layoffs are commonplace. As a result, fewer people are purchasing goods and services.

But there’s hope on the horizon. If the Obama Administration succeeds in pumping $800 billion into our economy, there may be huge changes. To make such a gigantic investment, the federal government will need to print money faster than they’ve ever done before. It will likely yield not only new and vital jobs, but also significant and potentially massive inflation.

Inflation is not always bad; it also spells opportunity. But only for those who predict it, and act on it in advance. This is a chance to buy low and sell high – by taking three steps. First, issue long-term bonds to raise cash. Second, use the cash to invest in long-term projects that create jobs and build long-term assets for Vermont, like roads and bridges. Third, pay back the bonds when their value has declined, due to high inflation. This strategy is essentially what House Speaker Shap Smith proposed on Jan. 7, 2009.

There are skeptics to this bold plan. Some think wrongly that debt is always bad. Sure, you don’t finance a vacation through a home loan. But if you’re buying a house, or starting a business, a long-term loan may be smart. Likewise, in recessionary times, one of the best things a government can do is to increase the amount of money flowing through its economy. President Hoover disagreed with that notion, and history judges him harshly on his lack of economic engagement.

Add to the equation that Vermont has an AAA bond rating, the best in New England. Plus, our debt/income ratio as a state is lower than most states nationally. We have the room in our budget, we have the credit rating to make it a wise investment, the need is palpable, and the timing seems almost perfect.

If we issue bonds now and pay off our debt at times of high inflation, we will succeed in selling high and buying low. If done right, Vermont will grow jobs, strengthen our infrastructure, and be the better for it. Our only obstacle is overcoming our fear.

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Rep. Jason P. Lorber (D-Burlington) holds an MBA from Stanford and serves on the House Commerce & Economic Development Committee. www.friendsofjason.blogspot.com