Bernanke may have a very high I.Q but that is besides the point. If the man does stupid things it means he's stupid, regardless of how 'smart' he is.
Well his actions haven't made us rich yet so he can't be doing too bad of a job, I can't look back on 1 decision recently and say it was stupid because the scenario which involves no action isn't any better. It really is a case of damage limitation at the moment, he can't work miracles. The US is in trouble, there has to be more pain before they can get back on track but they'll figure it out even if it does mean another recession. As I said in another thread, question him if we see evidence of inflation, question him if we get a new high in investor safe havens. Correction, Schiff is in a position where he can yell the truths as much as he likes, Bernanke has to be more responsible. His words move markets, he's hardly in a position to announce to everyone what he's really thinking.
What do you mean? I was nearly agreeing with you - they are doing a good job of keeping the system going with adhesive. In fact, given all the guff from the permabulls year after year about an impending collapse, I'd say they are doing an exceptional job. The man is probably just doing the job he has been asked to do, whilst putting on the face he knows he has to put on to keep hisexceptionally paid job. Edit to add: +1 ^^^ This is exactly what I was trying to say.
^ By bailing out the banks & buying toxic "assets" both domestic and foreign, by articially lowering interest rates to utterly ridiculous levels and by actively allowing the US Government to continue is deficits to oblivion Ben is not being "responsible", he is being corrupt and is the exemplar of the worst aspects of crony capitalism. By his (and the rest of the boards) actions, he will bring about years of stagflation in the world's largest economy at best or hyperinflation and the "crack-up boom" predicted by Mises around 70-80 years ago. At least Volcker had the balls to increase interest rates to help exit the '70's stagflation, while Ben's done nothing but kick the can, make things worse and actively steal wealth from workers and savers across America and the world to fund his cronies. He is an utter disgrace and nothing justifies what he's been doing.
I did think along these lines to begin with, because I am very much against the fed, but it's in their interest to get things flowing again so the deeper you look into it the more you start to realize the majority of their decisions are the lesser of 2 evils. You simply can't do anything else but kick the can and hope things improve, give me another viable plan of attack? I will be the first to agree with you guys when I see evidence of unhealthy inflation.
I think Bernanke knows *exactly* what he is doing. There's a currency war with China. Everyone else thinks it's about unemployment numbers.
I agree that that is probably was one of the motivations but you don't win a currency war by debasing yours faster than the other guy (Gresham's Law and all that). They'd never get into the same level of problems if interest rates (and money supply) hadn't been mucked about with in the first place. The best way out of the war is to insist on sound money and the market will do the rest.
ALL inflation is unhealthy. There's no such thing as a "good" level only a more "tolerable" level. Inflation always lags the printing so by the time you see the "unhealthy" inflation it's already too late. Arguing more of the same because we haven't seen it yet is a path to disaster. As shown in the graphs I linked to in the earlier post the main reason why we haven't seen much additional inflation in the US yet is because the additional M0 hasn't entered the real economy yet as banks have kept it on reserve. In a proper recession the fake money would have evaporated as debts were truly written off but in this case they have simply been shuffled and allowed to bubble even further. Stagflation awaits (along with US Govt defaults on various promises to its citizens).
MAD - just a case of destroying the other guys first. Bankers are getting wealthier compared to everyone else - that wouldn't happen with sound money. The game would revert to things like, oh, loaning money out for higher interest rates than you borrow it. Where's the fun in that. This central money printing is benefiting a very specific segment of society. As I said, Bernanke knows *exactly* what he is doing.
The good & bad news. At some point the music will stop. I don't think we are that far away from it. No economy will be immune even with the World's Greatest Treasurer on the team. http://www.silverdoctors.com/jim-willie-immutable-gold-laws/ Cheers markcoinoz
Bernanke isnt stupid hes manage to build the worlds biggest house of cards while juggling. It takes a bright man to maintain a charade that is able to fool the masses. Any idiot can tell the truth but a genius can put a spin on a bad situarion to make it look good.
Fair call - it's just amazing though that there are so many halfwits here who are condoning his actions as somehow benefiting US ciitizens as a whole...
Bernanke is just doing what he's being told by the shareholders of the Fed. He's just an academic front. In the way of The Sopranos, the East are getting their cut for their cooperation in the racket. They are the next front. The ultimate racket, the reset button, is war. bankruptcy re-organization. When you own printing presses, you don't mesure wealth in paper money. especially gold. When you attach interest to a currency, you submit yourself to the compound interest equation. The most powerful force in the universe. the outcome is inevitable. Everything else is noise. Theatre for the punters. Will gold give you more and more power? the answer is yes yes yes. So where does that leave TA? just another joke for those who value things in paper money.
An important note about the bold part, the base money is the amount circulating and it is the result of ALL influences, not just one. It's highly possible that most of the QE dollars (in strict interpretation as new dollar notes) were spent, BUT another influence UNDID most their addition, causing the M0 to increase at a much lower rate than the dollar creation rate. That other influence is a population part that CEASED spending, being people that became aware of the crisis, and the negative outlook, and as a behavial consequence, started to save, in order to overcome a possible future hay period (losing job, higher costs, uncertainty). So what happened: the central planning sterilized (under control by the Fed on a common banks account at the Fed) those saved dollars. So we have two major 'forces', a deflationary and an inflationary, and the M0 is the net outcome of it. And this spending drop a the population part is an important and even crucial element to consider. Because it means that when this crisis "seems" to come to an end, and people regain some confidence, and after X crisis years being reluctant, finally start to spend more, that the much expected but X years delayed strong price inflation wave all of sudden pops up big, despite attempts of the central planning to stop it along increasing interest rates. The only way to avoid this price inflation wave, is an economy, the producing part of the population, that succeeds in improving their production in such a way that they can maintain their old price levels. In other words: produce X times as much at the same production cost. In the 1980's, computers/automation/bigger scale production succeeded in that. Starting from todays situation, I highly doubt it to repeat. Todays monster machines replaced by versionx X times bigger? So that's why I decided to swap my bank savings for silver early 2011, despite the already tripled price since 2008. Based on what I read/know, it appears clear to me that a recession is a central planners system killer. Their system drives on an ever growing money supply, and if the opposite happens, it starts to work against themselves (the very reason that they are scared as hell from deflation). I don't see a soft outcome from this crisis. At least not without governments undoing decades of intervention and regulation. In a world without alternatives that are clearly better, bad trends can continue upto depression and the point of conflict between population parts. The absence of serious/hyper inflation has a dead stop point: the point at which people fail to continue cut spending. And that on its own already implies a preceeding goodbye waving to welfare. Look at the continuing series conflicts in middle east/north African countries. Those are early birds that signal what is next for the rest of the world. If you have silver, stay tough. Take some care when buying, and show some strong hands, hold. Remember all those that sold in concerns / hope to buy back in lower. Because above situation makes it very likely that you'll have ended up giving away your position in the buying order towards the next big event of this crisis since 2008. Having paid too much at a given time is bad. But selling at a too low price is also bad. And the worst is combining both, repeating errors. The parasiting part of the population is spending now. That's why they created new fiatmoney: to continue their 'business' (.. parasiting). So they are buying now, at prices that will be the old prices once the inflation wave arrives. The population part that is now cautious/reluctant/uncertain to spend, is in reality helping the parasites to get the time needed to erase their debt during the old price levels, so that they have enough left on the end of the month to pay off their debt. So, despite the central planners seem to not like people cutting spendings, reality is exactly the opposite. They actually don't want them to spend now. I don't listen. I have been busy swapping all my euros to silver and other stuff and new wages same story. I have socks, shoes, tshirts, coats, spare parts, basic stuff that is very unlikely to drop in price since end of production optimisation was long ago, enough for decades ahead. And that's what I will continue to do. If silvers price is too high to be justified, I buy such stuff (I'm not buying whatever in whatever quantities to spend all the avail euros, just what I can buy now instead of over a decade or so. The rest sits ready for a next silver supported price.
