The former Federal Reserve chairman Alan Greenspan believes that Ben Bernanke and the Fed should start tapering stimulus "whether the economy is ready or not." [youtube]http://www.youtube.com/watch?v=yuL_rdYnSG0[/youtube] Read more: http://wp.me/p2hryu-AT
this is the video of him talking about it. http://www.cnbc.com/id/100798203 Greenspan is all over the place and should be in a retirement home. Though i agree with some of the stuff he says. And regarding the bonds they already have lost control in the market, hence the FED being the main buyer.
I was reading somewhere (Sinclair maybe?) that the gold crash was designed to help banks buy bullion. Maybe the same strategy is happening with all this end QE bullshit. Talk the USD up, gold stays low, buy lots of gold, keep QE going to infinity until bust!!! Any talk that QE will end or be tapered is just that, talk. Designed to move one market or the other. It won't end.
I like the reference to the beginning of the end of the Roman republic. And I'm afraid you're right. The road that we're on now is all downhill and there's no stopping it without the general public feeling some pain. Of course, the quicker it's stopped the less pain will be felt... but this tenant will be ignored for political expediency as long as it can be prolonged until after the current batch of politicians finish their careers.
Here's what the crim said not to long ago [youtube]http://www.youtube.com/watch?v=q6vi528gseA[/youtube]
QE infinity was the tipping point before that it was almost impossible... now it is impossible. The only thing keeping the beast alive is the generous donation via inflation of every USD holder
"they have crossed the Rubicon already, just a matter of time taking it's course" yep, they now have no choice but to keep going over the cliff. OC
what I don't understand is why they don't use some of the QE to fund greatly needed infrastructure projects as they have done so in the past. That way they are creating job, which then makes more money flow to the middle and lower class people and it creates project that everyone can benefit from in the future. Seems like a win win to me. But instead all this money is being used to plug holes and therefore does nothing. It's almost like the FED are really trying to stuff things up.
Generally when governments spend money on infrastructure projects it is a form of malinvestment. The thing is, governments don't have the money to do it, any money they do throw at "public infrastructure" would just be borrowed money which an indebted future generation would just have to pay off anyway. So it's best they don't broaden the scope of QE.
[sarcasm] Yeah much better they use that money to save the bankers from their mistakes. Poor dears - they might have missed out on their bonus if it wasn't for the Fed. Yep it would be a real malinvestment for the US to spend the money fixing up their aging highway system or improving their railroads or making high speed trains [/sarcasm] There are so many better things they could have done with that money than buying worthless paper assets from the banks it's just sad. Normally people that commit fraud get put in jail, but if you are a banker you get a bonus instead.
A brief summary of the very conflicted Alan Greenspan : - 1966, Alan Greenspan is sacked by economist Michael Hudson. "He was known as a hack that always gave ... his clients what they wanted instead of something actual." http://en.wikipedia.org/wiki/Alan_Greenspan - 1977, Alan Greenspan graduates with a PhD from New York University with his dissertation including a discussion of soaring housing prices, their effect on consumer spending and anticipates a bursting housing bubble. http://en.wikipedia.org/wiki/Alan_Greenspan - 11 August 1987 31 January 2006, Alan Greenspan serves as Chairman of the Federal Reserve Bank. Appointed by Ronald Reagan, he was renowned for his "easy money" policies, dropping interest rates from 3.5% in 2001 to 1% in 2002 and noting that this drop in rates would lead to a surge in home sales and refinancing. http://en.wikipedia.org/wiki/Alan_Greenspan
See the thing is trew, it should not be the government's role to involve itself in any market or be the fallback guy for any provider of services, let alone the provider of services during a depression just for the sake of stimulating a sector of the economy. I agree that governments should not be assisting bankers, but your sarcasm inserts suggest that you think they should also be assisting manufacturing, banking, retail, transport, mining, technology, communications, social care, health, education, warfare, the sex industry. Where does the list end trew? There are not so many things that they could have done better with that money simply because they did not have that money to do anything in the first place!!! The money was created into existence by a private organisation, sold to a government at an exorbitant profit and paid for by a compliant population, many of which are yet to be born. I agree trew it is a disgrace but to suggest that any government is capable of managing such illgotten funds and is capable of directing them to infrastructure projects that have public benefit is foolish. For a start there is no such thing as the public benefit, someone always misses out if a new highway is pushed through or a new bridge is built, the land on which these "public goods" is built has to be resumed from someone. The public benefit only exists at the expense of the minority, generally the minority that are directly affected leaving the majority to carry on their unaffected lives. There is nothing that the US government could've done better with that money because it is not their money they are spending. The best thing they could do is not spend it. It's as simple as that.
I agree in most part that most of government spending today is wasteful, but that's also true with a lot of private sector projects. The reality is when a project becomes too big the government is normally the only one that will and can fund it. Do you think these projects are wasteful and provide no benefit to the public: Roads, internet, dams, NASA & other large scale research projects like ITER. The list can get very big. I think its very important for the government to fund these very large scale time consuming project. The problem is that for some reason they have stopped funding things the people can get true benefit from and instead are just burning that money. I guess step one for the US would be get rid of the FED and create your own debt to which you don't have to pay any interest on. Inflation should only come through large scale project that everyone will see benefit from. Anywho that's just my view.
No, in this case I totally agree. Not necessarily with the bigger 'govt should not do anything' argument but in this case a govt that is up to it's eyeballs in debt is in no position to be borrowing even more money and creating it out of thin air. The bigger travesty is that, as you say, it will be paid for by the population and they won't even get any benefit out of it - only the elite bankers get the money.
Nobody is saying that Govt funded projects are black holes where money goes in and absolutely nothing of benefit comes out. The people working on the projects are just people doing the job in front of them. Very large privately funded projects happen all the time that produce massive benefits to people but (excepting govt meddling) all of them are risking their own shareholders money for real, measurable benefits to society not because some politician had a brain fart and then steals other peoples resources to build their "vision" and indebts millions of people (including children) for decades to come without any measurable way of knowing the benefits.
leo25, your #10 They prefer to borrow a few zillion dollars and hand it out to the zombies to buy booze and drugs. You view is spot on, but do not wait for it. OC
