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| Economy |
| Shut Down the Fed (Part II) |
| 2010-09-28 |
| I apologise to readers around the world for having defended the emergency stimulus policies of the US Federal Reserve, and for arguing like an imbecile naif that the Fed would not succumb to drug addiction, political abuse, and mad intoxicated debauchery, once it began taking its first shots of quantitative easing. My pathetic assumption was that Ben Bernanke would deploy further QE only to stave off DEFLATION, not to create INFLATION. If the Federal Open Market Committee cannot see the difference, God help America. We now learn from last week’s minutes that the Fed is willing “to provide additional accommodation if needed to … return inflation, over time, to levels consistent with its mandate.” NO, NO, NO, this cannot possibly be true. Ben Bernanke has not only refused to abandon his idee fixe of an “inflation target”, a key cause of the global central banking catastrophe of the last twenty years (because it can and did allow asset booms to run amok, and let credit levels reach dangerous extremes). Worse still, he seems determined to print trillions of emergency stimulus without commensurate emergency justification to test his Princeton theories, which by the way are as old as the hills. Keynes ridiculed the “tyranny of the general price level” in the early 1930s, and quite rightly so. Bernanke is reviving a doctrine that was already shown to be bunk eighty years ago. |
| Posted by:tipper |
| #3 "manipulation possibilities that would create unintended consequences not desired in a free and open market" They're intended consequences now, Broadhead. Of course, the clowns in charge don't want a free and open market. >:-( |
| Posted by: Barbara Skolaut 2010-09-28 13:58 |
| #2 IIRC some of the Founders were against a Nat'l bank because of manipulation possibilities that would create unintended consequences not desired in a free and open market. |
| Posted by: Broadhead6 2010-09-28 11:06 |
| #1 The Fed was established to address the cyclic problem of recession/depression that America had experienced in the 19th Century. Since then, we've had the Great Depression and, now, the Great Recession. If you believe in fundamentals, it's time to reexamine if an institution is fulfilling the rationale for its existence. |
| Posted by: Procopius2k 2010-09-28 09:23 |