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20 Questions For Ben Bernanke

Tyler Durden's picture


A game of 20 questions with the Fed Chairman...

1. The rescue packages in 2008-2009 were all aimed at restoring CONFIDENCE to the financial system.  Yet from 2001 to 2011 the DXY is down 41.5 and gold is up 473%. Does this not equate to a loss of confidence in the US monetary system? If not how would you explain this phenomena?

2. In March of 2009 you said the ONLY reason you care about Wall Street is because of the affect it has on Main Street. You wanted to become Fed Chairmen to make things better "for the average person". You have been Chairmen since 2006, do you believe you have accomplished your goal? And if so how?

3. In March of 2009 you stated that "many mistakes were made leading up to the crisis of 2008", chief amongst them was "enormous amounts of savings has flowed into the United States, and some other industrial countries. That savings has come from China and East Asia. It's come from oil producers. And it has-- and hundreds of billions of dollars, it has come into our financial system. And, you know, that would be great if we took that money and invested it wisely, and got a high return. But instead, our financial system-- didn't-- didn't do a good job"  What has changed since you made that statement? Is money being invested wisely.....getting a high return?

4. You believe that confidence in the financial system, is one of the most if not the most important aspect in creating a lasting recovery. Yet 2 years after the recession ended and the banks have been stabilized, the recovery remains tenuous at best. Could this be because "average people" do not trust a regulatory system that did NOT hold banks and the people therein accountable for their bad/fraudulent behavior leading up to the financial crisis of 2008?

5. What do you consider to be the mandates of the Federal Reserve? Is the "wealth effect" not the 3rd mandate of the federal reserve?

6. You have stated that you believe high food and fuel prices to be transitory. Can you define transitory? And define what you believe to be a return to normalcy for food and fuel prices.

7. In March of 2009 you stated that for QE1 the Fed was printing money. However, you have stated that QE2 is not printing money. Can you define the difference?

8. The recession has been over for 2 years. Yet job gains have been anemic. Why do you think this is? And how long until Americans will see a more normalized unemployment rate?

9. The disclosed portfolio of Maiden Lane I assets includes various eurodollar and interest rate swaps indicative of hedging. Does the Federal Reserve hedge its broader $2.7 trillion SOMA Balance Sheet? And if so how? If not, why not?

10. Has the Federal Reserve ever invested in domestic or international equity markets? If so, which Wall Street broker does the Fed use to conduct equity market interventions?

11. In the June 2003 FOMC Transcript Vince Reinhart disclosed that the Fed had sold derivatives on instruments held by the Fed's balance sheet: "the Desk sold options on RPs for the weeks around the century date change that totaled nearly $0.5 trillion of notional value." Has the Fed since then engaged in selling of derivatives on RPs or any other Fed assets? If so, which Wall Street institution does the Fed use as a broker to transact through?

12. The president recently announced that he will pursue oil "speculators" blaming them for the nearly 50% jump in Crude. Yet a simple correlation shows that broad commodity indices correlate nearly 100% with the size of the Fed's assets. In light of this do you side with the president and blame speculators for the surge in energy prices, or believe this is some collusive cabal acting independent of the surge in free liquidity?

13. A quick look at your most recent balance sheet indicates that "Other Federal Reserve Assets" hit an all time high of $125.6 billion in the week ended April 20. Can you provide a break down of what these "assets" consist of?

14. A prevailing theme of over 80% of recent Permanent Open Market Operations has been the prompt refunding of Primary Dealer "On The Run" (just auctioned off) Treasurys back to the New York Fed, with the Fed purchasing up to over the old SOMA limit of any given CUSIP within a month of auction. Can you explain how this is substantially different from outright monetization of up to a third of any given issue? Can you also explain and quantify what the economic benefits to the Primary Dealers are from participating in such a process? Does the Fed keep track of how much in Mark To Market gains and losses are incurred by taxpayers as a result of the POMO reverse dutch auction? How much money have Primary Dealers made by "flipping" bonds from the Treasury back to the Fed?

15. At the time QE2 is over, the Fed's balance sheet will be just over $2.8 trillion. The DV01 on that amount of holdings will be about $1.5 billion, or in other words a 1% rise in interest rates will be three times greater than the Fed's total capital of $52.6 billion as of April 20. Does the Fed only have a capital buffer for a 33 bps rise in rates? What happens if rates increase by more? What is the basis by which the Fed's total capital account is calculated?

16. As a result of rising interest rates, the principal repayments of agency MBS and agency debt (the mandate of QE "Lite") have ground to a halt. In fact, in the most recent POMO schedule, the QE Lite component was a QE2 low $17 billion. If rates continue to rise (an indication of QE2's failure according to some) the QE Lite mandate will be rendered irrelevant. Does the Fed model for what interest level will end the process of principal repayments on its agency portfolio?

17. The Fed is expected to continue the QE2 Lite mandate of keeping the size of its balance sheet constant, which means rolling maturing Treasurys. As of April 20, the Fed held $119 billion in Treasurys maturing in under a year. Assuming the full amount is "rolled" this is roughly one fifth of the full amount of of Treasurys to be purchased under QE2. If so, will replacement Treasurys be purchased in the open market and what maturities will the Fed be focusing on?

18. Recently the San Francisco Fed compared QE 2 to 1961's Operation Twist whose purpose was to halt the exodus of gold as an interest rate arbitrage vehicle from the US to Europe. Is the Fed conserned that gold is once again being transferred offshore? Does the Fed have a "fair value" estimate for what the price of gold should be under the Fed's current view of the economy?

19. The Fed focuses on CPI to inform its decision about the prevailing rate of inflation in the US. In the US, food and energy components of CPI are deminimis, accounting for under 20% of the overall inflation gauge. Other countries, particularly China whose currency is pegged to the dollar, and whose monetary policy has a major impact on the US as well, have a CPI where food and energy account for nearly half the overall inflation metric. Is it this discrepancy that the Fed will attribute the paradox of China tightening rates (and having done so for nearly half a year now) while the US continues to rely on a ZIRP policy and is still loosening via daily POMO operations? At what point will the Fed consider this parallel tightening and loosening for the world's two largest economies, whose currencies are pegged, problematic?

20. In prior FOMC transcripts, Alan Greenspan indicated that gold had historically been used by the FOMC to gauge inflation expectations. Is it still used in that capacity, and if so what does it tell the Fed about where the market believes inflation is headed?

21. Bonus question: Per Frank-Dodd, the Fed is now regulator of all banks. Yet banks are still allowed to circumvent Mark To Market accounting. How comfortable is the Fed that the financial information provided it by the MTM-exempt institutions is credible, the institutions are actually risk-free, and that the Fed is conducting prudent monetary policy in the absence of real time financial data?

22. Bonus Bonus question: the Fed's primary market-valued liability: the USD has plunged to multi year lows. Yet the Fed's primary market-valued asset: Treasury bills continue to trade in a range and as recently as some months back traded at all multi year highs. To what do you attribute this fundamental mispricing?

h/t Lizzie363


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Tue, 04/26/2011 - 07:17 | 1207106 hugovanderbubble
hugovanderbubble's picture

Spain is in default.


Europe is a maze.

Tue, 04/26/2011 - 08:13 | 1207221 Popo
Popo's picture

Bonus Bonus Bonus Question:   Which branch of government has the sole right to initiate spending?   Since you have been Chairman of the Federal Reserve, where has the majority of taxpayer supported spending originated?    What is your view of the constitutionality of the largest spending package in American history being initiated via the Treasury in conjunction with the Federal Reserve  (and not in the House of Representatives)?

Tue, 04/26/2011 - 08:52 | 1207316 Careless Whisper
Careless Whisper's picture

Bonus question: Mr. Bernank a recent study from Columbia University says it will take at least 18 minutes to stop inflation. Are you still sticking with your estimate of only 15 minutes?


Tue, 04/26/2011 - 10:08 | 1207557 66Sexy
66Sexy's picture

20 answers from Ben Bernake..


"I dont recall. I dont recall. I dont recall. Hmmm. I dont recall. I dont recall.I dont recall. I dont recall. I dont recall. Hmmm. I dont recall. I dont recall.I dont recall. I dont recall. I dont recall. Hmmm. I dont recall. I dont recall.I dont recall. I dont recall. I dont recall. Hmmm. I dont recall. I dont recall."

Tue, 04/26/2011 - 10:27 | 1207690 Dan The Man
Dan The Man's picture



Tue, 04/26/2011 - 11:38 | 1207970 JW n FL
JW n FL's picture

Boehner says “Lazy Un-Employed Scumbags are to Blame for the Recession” I am paraphrasing a lil.

Boehner: "Can't pay your student loan? Face it your parents were lazy and you couldn't afford college. The world needs ditch diggers and you were born into a family of them. Can't pay your mortgage? Your house was too expensive and you couldn't afford it. Your taxes going up too much? That's what you get for electing a democrat president. Never had a job after you got a degree? You learned nothing in school and you're lazy. I didn't get to be a congressman by watching jersey shore or playing xbox. You think there's no jobs for you? There used to be. There was when I was your age. You don't have fee time because you have to work all days of the week for 16 hours a day and you don't get paid hourly? Thank the unions. They made decent jobs so out of price range of the average American company that they can't hire anymore people and the works' gotta get done. These unions... I tell you they won't be happy till no one in America has a job. And health care? Don't get me started on health care- doctors study their entire lives and they barely make enough to live and yet Obama, who had his entire life handed to him on a silver plate wants to cut their pay. You know that's gonna do? Increase costs- the average persons going to have to work even harder just to see a doctor. "


Taibbi: "With mounting unemployment what do you think is the possibility that we'll see an Egyptian style uprising of the youth? Should we be worried?"

Boehner: "It's not going to happen in the US. The kids here are too fat, too lazy, to addicted to TV, fast food, cheap credit, and facebook. I have news for you- there are plenty of jobs out there- the unemployed don't want them. Today's college student feels entitled to make at least $24 right after college. When they find out they can collect unemployment they would rather do that. You know the average college educated unemployed person is collecting $60k a year? The CATO institute did a study- and I mean, you and me we're hard workers we could just sit around and live, but these kids today- that's all they've been doing their entire lives. I'm not worried for this country- there are a few of them who actually want to work, take Mark Zucker(sic). You don't build a site like facebook out of thin air- it takes talent and hard work. I went to a community college and all I saw were people sitting in front of computers typing away, their eyes were fixed. Probably just facebooking away."



Boner says that the young ones are to, too busy facebooking to care to participate in a "Day of Rage" here in the U.S.! I say Popiecock!

here is some food for thought..

Michigan, Police have been downloading info from cell phones during stops since 2006!

Military Helicopter Exercise startles Miami residents (YouTube Video) BlackHawks flying downtown Miami at Night. (why do they only practice with the BlackHawk Evac's from the Bank of America Building?

Is something happening soon that would require a full on evac from the B or A Building? seems fishy..

Tue, 04/26/2011 - 14:47 | 1208587 nope-1004
nope-1004's picture

I bought more physical silver today.  That's my answer to all 20 of these questions.


Tue, 04/26/2011 - 14:57 | 1208626 Blythes Master
Blythes Master's picture



THE bonus question:

I said this awhile ago, before TD praised some schlep for saying it on a conference call...


"The only method of protest is to stop paying taxes and storm the Bastille, er Audit the Fed."


Finally, someone else said what I've been thinking all along.


To wit; If the Fraud, er Fed can monetize the debt away at will....then someone PLEASE explain to me why they have to confiscate our money through taxation?


A simply logical argument that when/if the masses put 2 and 2 together, the ponzi is over.

Tue, 04/26/2011 - 15:16 | 1208686 Ferrari
Ferrari's picture

Because the government has most of the cops and all of the prisons is why I pay my taxes.

Tue, 04/26/2011 - 17:17 | 1209200 Shocker
Shocker's picture

Heres a Question. We allowed all this stimulus and free money to be pumped into this economy, so why are so many companies laying off? You would think with all this basically free capital everything would be going crazy... umm guess not.



Wed, 04/27/2011 - 01:34 | 1210303 The Navigator
The Navigator's picture

Because ALL of the bailout money went to the banking industry, and to no other industries. Free capital for the banksters, fee capital for everyone else.

Tue, 04/26/2011 - 21:17 | 1209818 myshadow
myshadow's picture

I'm not fan of the speaker, but this post is an april fool's joke.

Wed, 04/27/2011 - 03:21 | 1210377 AnAnonymous
AnAnonymous's picture

At least, this guy is not lazy at spouting cheap propaganda.

Zucker is a hard working US citizen who built up Facebook out of nothing and the unemployed are a lazy bunch spending all their time on Facebook. Laziness is a factor in the success of Facebook. What a tool. US miracle that people can spit cheap propaganda like that and still be publicized.

Tue, 04/26/2011 - 16:40 | 1209054 ZFiNX
ZFiNX's picture

a few broken fingers ought to loosen his tongue.

Tue, 04/26/2011 - 17:26 | 1209234 disabledvet
disabledvet's picture

no.  you'll need more than that.  of that i am certain.  you could "send in a woman."  look at what NBC did to Greenspan.

Tue, 04/26/2011 - 16:41 | 1209058 ZFiNX
ZFiNX's picture

I will remember to only click 'save' once from now on.

Tue, 04/26/2011 - 09:16 | 1207405 SuperRay
SuperRay's picture

Bonus bonus bonus bonus question:  Mr. Bernanke, are you really as big an asshole as you clearly appear to be, and do you have any idea what the real world even looks like?

Tue, 04/26/2011 - 09:40 | 1207495 cowdiddly
cowdiddly's picture

Bonus question #_. Since you have taken your station, I detect a hint of silver color in your beard. Since we cannot believe anything that comes directly from your mouth and your voice has been so, shall we say shaky of late, are we to look for facial expressions/features for hints on the direction of economic policy.Is this in any way attibutable to your subconcious views and are you using a Grecian formula to hide it.?

Tue, 04/26/2011 - 12:55 | 1208166 tawdzilla
tawdzilla's picture

Bonus question:

Ben, You may have been acting without consequences thus far, but the Karma Police will knocking at your door one day soon.  I'm not worried about you, your day of reckoning will come.  I'm worried about the future generations you have chosen to enslave through debt bondage.  Why have you found it necessary to line the pockets of a handful of pump n dump machinists, at the expense of the dollar and the republic? 

Follow up question: After you are done destroying the dollar and the republic, do you have any ideas on a replacement for either one?  Surely, you must have some chicken scratch on the back of a cocktail napkin stored in the top drawer of your desk (maybe next to the Braun beard trimmer with #3 attachment, your BSB engraved hand mirror, and your minty fresh breath spray.) 

P.S. I do have to give you credit for one sloppy and reckless as you are with the dollar, I would've guessed your beard would look tattered and disheveled by now.  To the contrary, you have preserved your beard in a tidy and well-kept manner.  If you treated the dollar with half as much respect as you treat your beard, we might have had a snowballs' chance in hell.              

Tue, 04/26/2011 - 14:09 | 1208441 chopper read
chopper read's picture

'P.S.'  ...too funny!  :)

Tue, 04/26/2011 - 14:09 | 1208453 dogismyth
dogismyth's picture

Question:  Now that you have gang-raped and ass fuc#ed most americans, will your wife still give you a blow job?

Tue, 04/26/2011 - 15:45 | 1208804 Montgomery Burns
Montgomery Burns's picture

Anyone who has to ask is obviously not married.

Tue, 04/26/2011 - 19:43 | 1209631 Ned Zeppelin
Ned Zeppelin's picture

Funny. True, and still funny.

Tue, 04/26/2011 - 22:46 | 1210046 I am Jobe
I am Jobe's picture

Loved your questioning. Keep it up. I think the ZH team needs to start the inquisition and make this live and watch Ben sweat like a pig. Hang the biatch and shut down the FED. Why not get Ron Paul to question this guy. TV is getting to boring these days and would love to watch Ron grill Ben all day. No fucking media allowed to question the Idiot Ben.

Tue, 04/26/2011 - 10:20 | 1207662 mendigo
mendigo's picture

my favorite, but I think he would argue that he did not actually "spend" the money

But hasn't the net affect of QE2 been to fund the federal spending - is it not irresponsible and dishonest to fund federal spending in this manner?

Tue, 04/26/2011 - 16:01 | 1208865 Henry Chinaski
Henry Chinaski's picture

Congratulations, Dr. Bernanke, on being honored as Time Magazine's 2009 Person of the Year.  Do you think you can follow up that great honor with a Nobel Prize like President Obama?

Tue, 04/26/2011 - 10:31 | 1207689 French Frog
French Frog's picture

Some wonderfully probing and precise questions in that list of 20 but somehow i would be amazed if any journalist(s) in the audience dare to be not only THAT bold to ask them but also SO bold to dare to refute any full-of-half-baked-truth answers by TheBernank.

Still, there's hope, is there?

Tue, 04/26/2011 - 10:54 | 1207807 HK
HK's picture

+100 French Frog, the MSM is soooo controlled that the press conference will be more like a tea party, anyone being obnoxious will not be invited back.  However, if you're looking for hope, we might want to forward the questions to Ron Paul for his next little chat with the Bernanke.

Tue, 04/26/2011 - 21:23 | 1209837 HK
HK's picture

I just took a nap and while sleeping, both Chevy Chase and Johnny Carson came to me in my dream and revealed how the Bernanke will answer those questions:


Tue, 04/26/2011 - 15:49 | 1208820 jal
jal's picture





Tue, 04/26/2011 - 17:44 | 1209281 tellsometruth
tellsometruth's picture

I want to know this from Washington's Blog:

"Please list the banks and other entities and individuals which own the Federal Reserve, and their percentage of ownership"


    I also want to no what governments/nations/little corners of the world do not have a central bank...can anyone provide any information with good sources please?





Tue, 04/26/2011 - 19:06 | 1209536 RockyRacoon
RockyRacoon's picture

More fuel for the fire from By Richard Band at MartketWatch:

5 tough questions for Ben Bernanke

Here are some questions Fed Chairman Ben Bernanke should be forced to answer when he faces the press after Wednesday's meeting.
Read more: 5 tough questions for Ben Bernanke.

Tue, 04/26/2011 - 19:19 | 1209559 Cthonic
Cthonic's picture

What you're really asking is which countries aren't in the OECD.,2340,en_2649_201185_1889402_1_1_1_1,00....

Tue, 04/26/2011 - 09:22 | 1207389 TruthInSunshine
TruthInSunshine's picture


Here's are a few more questions I would suggest:

  • Mr. Bernanke, what is the historical normal rate of interest in the United States?
  • Mr. Bernanke, do you believe a low interest rate implemented for any significant period of time creates speculation, asset class bubbles, malinvestment, and other market disequilbriums? If no, why? If yes, could you please elaborate as to how this 'plays out?'
  • Mr. Bernanke, do you believe that the low interest rate policy implement by The Federal Reserve since 2008 has caused or contributed to, in whole or part, speculation, asset class bubbles, malinvestment, and other market disequilbriums? If no, why? If yes, could you please elaborate as to how this manifested itself?
  • Mr. Bernanke, do you see The Federal Reserve implementing policies that return interest rates in the United States to historically more normal interest rates? If so, when?
  • Mr. Bernanke, is there any risk that the types of assets now held on the balance sheet of The Federal Reserve could fall in value in any significant way that would cause the Federal Reserve to either have to borrow money, raise more capital in another manner, require U.S. taxpayer assistance, or not be able to otherwise meet its financial obligations?
  • Mr. Bernanke, you had previously told Congress that the Federal Reserve would "not monetize the federal deficit," yet The Federal Reserve has been and is still buying 50 billion worth of treasury notes per month, which constitutes 70% of all treasury note issuances. How is this "not monetizing at least 70% of U.S. government deficit spending?"
  • Mr. Bernanke, you had said that The Federal Reserve was printing money back in 2009 in several interviews, including one on '60 Minutes.' However you now say that The Federal Reserve "is not printing money," and in fact, you said that in another '60 Minutes' interview this year. I have brought those two interviews with me and can play them for you and everyone here if you'd like to see them; it won't take more than a minute or so to watch the relevant parts of your statements then and now. How do you reconcile these two contradictory statements?
  • Mr. Bernanke, you and other members of The Federal Reserve have stated that your policy of Quantitative Easing has contributed significantly to global inflation, including inflation in commodities, such as those related to energy and food. Many notable economists, such as Jim Grant and Laurence Kotlikoff, disagree with that assessment, and in fact, they claim there is data available which shows a direct and highly proportional relationship between Quantitative Easing and a rise in commodity, food and energy prices. Are you correct and are they wrong? If so, what data can you provide that supports your position?
  • Mr. Bernanke, The Federal Reserve has supported policies that allow banks to essentially pay savers little to no interest, and interest that is far less than even The Federal Reserve's own official rate of inflation. Does this policy punish savers and the fiscally responsible American Savers, does it subsidize large financial institutions, including what many have deemed 'Too Big To Fail Banks,' and is this a healthy policy to maintain in lieu of America's large deficits and large national debt? As a follow up, shouldn't prudent monetary policy essentially do the opposite of this policy, by encouraging and rewarding savings, and discouraging and penalizing speculation?
  • Mr. Bernanke, does or has the Federal Reserve ever directly or indirectly purchased equities, equity futures or options on equities - or any other intruments bearing on or related to equities? If so, which broker-dealer has the Federal Reserve used to purchase such equities, equity futures or equity-related instruments?
  • Mr. Bernanke, has The Federal Reserve ever intervened in dealing between The Treasury Department and market participants, including but not limited to negotiations between The Treasury Department and AIG and its counter-parties, and has The Federal Reserve advised The Treasury Department as to what course of action to take with respect to the rate or amount of monies counter-parties to AIG or any other financial actor would or should receive via taxpayer-backed 'bailouts?'
  • Mr. Bernanke, there are several alternative metrics that have developed by academic sources that show inflation running at a much higher 'core rate' than what The Federal Reserve has proclaimed to be the case, and this would include a project known as "a billion price points" by the Massachussets Institute of Technology. Is it possible or even likely that The Federal Reserve understates core inflation, either because its methodology is flawed, or for any other reason?
  • Mr. Bernanke, does The Federal Reserve have the intent to preserve the U.S. dollar as the world's reserve currency now and in the future? If yes, what measures are you taking and will you take to see this polocy objective achieved? If your answer is no, please elaborate on what the intent is?
  • Mr. Bernanke, does The Federal Reserve have the intent to strengthen the U.S. dollar? If yes, what measures are you taking and will you take to see this polocy objective achieved? If your answer is no, please elaborate on what the intent is?
  • Mr. Bernanke, should any financial institution or bank be allowed to get to a position where it alone or in conjuction with other entities represents a systemic threat to the U.S. or global financial system? Are there any such entities that exist today? If so, can you name them? If you can't name them, why can't you name them? If your answer is no, what did you do and what are you doing now to ensure that no such entities exist?
Tue, 04/26/2011 - 10:02 | 1207598 traderjoe
traderjoe's picture

I got one: why does a sovereign country borrow it's own currency at interest from private corporations?

Please detail the shareholdings and dividend payments of the Fed.

Tue, 04/26/2011 - 10:13 | 1207641 TruthInSunshine
TruthInSunshine's picture

That's a fantastic question, actually.

The reporter who would ask it on live television would die in a tragic accident soon thereafter.

Tue, 04/26/2011 - 16:32 | 1209025 RighteousRampage
RighteousRampage's picture

As unpalatable as it may be to pay interest to the Fed, I wouldn't exactly trust our elected politicians (or their UST appointees) to directly manage a theoretically unconstrained fiat money supply.  Overall credibility would be lower in such an environment, and both interest and inflation rates substantially higher.  Besides, this way, the Fed can take the fall if things get really ugly (wouldn't be the first time) and the US Gov. will live on.  


I'm not defending the actions of the Fed, just pointing out that the construct has merits as well. 



Tue, 04/26/2011 - 17:34 | 1209250 disabledvet
disabledvet's picture

indeed.  "God forbid if they were to monetize the debt or something!"

Tue, 04/26/2011 - 18:06 | 1209369 traderjoe
traderjoe's picture

Bullshit. The real juice isn't with the Fed, it's with fractional reserve lending - whereby private banks create money out of thin air and then lend it at interest for infinite gross margins. Especially lending to the sovereign? It's a fucking bonanza. Read Modern Monetary Mechanics (Chicago Fed) and the Credit River case. 

I'd like to see some citations about inflation and interest rates being higher. Bullshit. Our country experienced less inflation and even deflation before the Fed.

Deflation benefits savers and the average citizen. And you really think there actually exists some theoretical restraints on the money supply after 3 quantitative easings? 



Tue, 04/26/2011 - 19:12 | 1209547 RighteousRampage
RighteousRampage's picture

I agree that some of the issue here reside in the dynamic created by fractional reserve lending.


Again, however, the alternative to such a system would be dramatically lower real growth (and thus lower living standards).  Monetary base creation through fractional reserve lending at least attempts (albeit not always successfully) to distribute funds to productive endeavors that have a chance of payback.  A hard money/commodity backed (i.e. gold) and/or non-fractional reserve banking system would be fundamentally limited and less flexible when it comes to monetary policy and international commerce.  One might argue that these constraints are healthy, but that is a different debate (and one that is likely worthwhile).


If everyone were determined to sacrifice a bit for the future, and played by the rules, you are correct that inflation and interest rates would not necessarily be higher, but real growth and international influence would be significantly curtailed, in my opinion.  


The problem ("as you so adequately put"), is choice.  And it seems that humans have a difficult time seeing through the now to choose the future.  



Tue, 04/26/2011 - 19:29 | 1209584 RighteousRampage
RighteousRampage's picture

To make my prior point a bit more lucid.  Most alternatives to the current system would require a nation to live within its means, which is great if everyone else did the same.  At the heart of the issue is power (and trust).  There are secondary order benefits to accelerating the velocity of money and commerce, which is effectively accomplished by the flawed system currently in place - it also allows for a projection of greater military and cultural influence than could otherwise be possible.  Would you accept a world in which the U.S. was a second rate power because other nations chose to cheat by borrowing from the future and we did not?





Tue, 04/26/2011 - 19:38 | 1209619 traderjoe
traderjoe's picture

To your last question - YES! F#ck the empire building.

Tue, 04/26/2011 - 19:42 | 1209627 RighteousRampage
RighteousRampage's picture

I would agree, so long as it meant we not subject to another's empire.  

Tue, 04/26/2011 - 19:33 | 1209596 traderjoe
traderjoe's picture

First, happy ZH anniversary.

IMHO, the key failing of economics is a belief that infinite growth is possible in a finite world. Second, that growth of GDP becomes THE measure of progress. That a 19" TV is growth over a 17" TV. But it ignores the impacts of debt, the increased skimming by the FIRE sector, etc. I wasn't around, but in the '50s/60's most families got by with one income and now two are required. Are we really better off?

Tue, 04/26/2011 - 19:43 | 1209624 RighteousRampage
RighteousRampage's picture

Thank you, TJ.


Just a quick counterpoint.  If you wanted to accept a standard of living of a 50's/60's family in today's world, you'd probably do fine on one income.  


Economically speaking, the crux of the issue is how to get the most production out of the people and leverage the national resources to maximum utility.  The downfall, in my opinion, is that it is human nature (augmented by societal prodding) to judge happiness relative to one's neighbors, which is why we all appear to be double-timing our way up a stairmaster.  

Tue, 04/26/2011 - 19:33 | 1209592 RighteousRampage
RighteousRampage's picture

Final point.  Deflation benefits savers, but discourages commerce and decreases monetary velocity.  Less transactions, less trust, lower overall standard of living, but probably more equitable (the flip side is that increasing monetary velocity encourages skimming and accelerates the transfer of wealth to those in closest proximity to the monetary great attractors - govt's, banks, etc.) 

Tue, 04/26/2011 - 19:50 | 1209653 Ned Zeppelin
Ned Zeppelin's picture

I've thought and written about the supposed logic behind the Federal Reserve, as being structured to be "above the political system" and therefore not as susceptible to temptations to manipulate monetary policy for the gain, I guess, of the majority.  Once you make that evil less likely, someone forgot that by lofting the institution beyond electoral control, they left open the barn door to the minority predator-owners of the Fed who have not hesitated to manipulate the system for their own gain.

So pick your poison, but I know the right answer is to end the Fed and change our monetary system to avoid problems created by both sides.

Tue, 04/26/2011 - 18:03 | 1209349 4horse
4horse's picture

. . . why does a sovereign country borrow it's own currency at interest from private corporations?


the only one

Tue, 04/26/2011 - 10:10 | 1207623 oogs66
oogs66's picture

no chance these questions are asked - they should be, but won't be

Tue, 04/26/2011 - 11:24 | 1207908 TruthInSunshine
TruthInSunshine's picture


Tue, 04/26/2011 - 10:12 | 1207627 Saint Tibb
Saint Tibb's picture

Good questions.  I believe you are missing a "not" in here:

"Mr. Bernanke, you and other members of The Federal Reserve have stated that your policy of Quantitative Easing has [not] contributed significantly to global inflation, including inflation in commodities, such as those related to energy and food. "



Tue, 04/26/2011 - 10:12 | 1207633 TruthInSunshine
TruthInSunshine's picture


Thank you.

Tue, 04/26/2011 - 12:14 | 1208096 JR
JR's picture

Dear TruthInSunshine,

For this, your words, Zero Hedge was created. The selection of your moniker in light of the darkness our Republic finds itself almost leaves me breathless.  Knowing there will be no answers to your questions, I don’t yet despair because the questions are there and the time approaches when Americans will answer them and the tyranny which protects Bernanke will be swept away. Regardless, the answers are in your questions.

Thank you for one of ZH’s most outstanding and most penetrating posts.


Tue, 04/26/2011 - 14:41 | 1208482 TruthInSunshine
TruthInSunshine's picture

Thanks for the high praise, JR.

I feel there is a growing awareness amongst the American People that something is seriously wrong with the nation, and that encourages me, but they seem to flail around when trying to formulate any hypotheses as to the whos and whats of the causes of their drifting lower standard of living and lost purchasing power, and most Americans still don't understand what the Federal Reserve is, wouldn't be able to tell you who Ben Bernanke is let alone the other members of the Fed, and they would absolutely no clue that the Fed is NOT part of our government, but rather, a private bank (nor that they pay taxes in the form of interest, or tribute, as I like to call it, to the Fed - Fed rebate to the Treasury notwithstanding).

The system is deeply broken. It's going to be a long, hard slog to get average people focused on the nucleus of one of the main sources of their problems.

Tue, 04/26/2011 - 18:25 | 1209436 tellsometruth
tellsometruth's picture


Good Questions!


wish this would happen during the next senate or congressional hearing:

"Mr. Bernanke, you had said that The Federal Reserve was printing money back in 2009 in several interviews, including one on '60 Minutes.' However you now say that The Federal Reserve "is not printing money," and in fact, you said that in another '60 Minutes' interview this year. I have brought those two interviews with me and can play them for you and everyone here if you'd like to see them; it won't take more than a minute or so to watch the relevant parts of your statements then and now. How do you reconcile these two contradictory statements?"


Tue, 04/26/2011 - 09:23 | 1207431 4realmoney
4realmoney's picture

This article explains everything. Where Greenspan instigated the equity bubble and housing bubble, Bernanke has created the monster of the government bubble:

Tue, 04/26/2011 - 09:55 | 1207543 bankonzhongguo
bankonzhongguo's picture

Bonus Questions:  Are you or Mr Obama the Anti-Christ?

Or, Why is it necessary to intentionally kill the US currency and most American households?

Do you ever worry that you and your people will eventually be held personally responsible for your intentional economic disasters that are only paralleled by the Weimar Republic and Zimbabwe? 

Do you think you will be lynched, shot, poisoned, or impaled? 

How about your kids and grandkids?

Tue, 04/26/2011 - 17:36 | 1209257 disabledvet
disabledvet's picture

I'm sure we can "do this one" in a more "clever and apparently appropriate way."  I'll get to work on it!

Tue, 04/26/2011 - 10:57 | 1207820 Gully Foyle
Gully Foyle's picture

Every so often this question needs to be asked, if you have 5 million tax free dollars sitting in an account how would you invest it today? Where would you park it? How would you manage to keep it safe if not grow over the next few decades?

Other than Gold and Guns.

You can't trust banks, you can't trust stocks, you can't trust bonds, you can't trust real estate. What can you trust?

And more importantly how has your strategy changed since last year?.



Tue, 04/26/2011 - 14:28 | 1208525 Silver Bug
Silver Bug's picture

The Chance of Bernake ever admitting to being wrong on basically every subject in his life are nil to none. He, like Greenspan is a complete farce and a joke. Helicopter Ben is going to assure QE to infinity, and therefore Gold and Silver to who knows where. I would honestly like to see him answer even one of those questions. Maybe then, we might have a hope of real change. For now its up to us to make the changes for them.

Tue, 04/26/2011 - 17:13 | 1209185 Hugh G Rection
Hugh G Rection's picture

23.  What does Satan's cock taste like?

Tue, 04/26/2011 - 17:47 | 1209292 America- Some A...
America- Some Assembly Required's picture

And the Fed was created to bankrupt the USA. After its first charter expired in 1933 the US was effectively broke. The FED was created by TPTB precisely to ensure American indebtedness in perpetuity. No chance the FED gets audited or disbanded- too many deep pocket players making big policy in small rooms. The FED is the seed that germinates into a one world government. Won't be long now- this planet is going to erupt into a shitstorm of violence as food prices soar. Anybody know a good way to shoot down a Predator drone?

Tue, 04/26/2011 - 18:39 | 1209460 I dont belong here
I dont belong here's picture


Tue, 04/26/2011 - 18:59 | 1209508 Hugh G Rection
Hugh G Rection's picture

50 BMG should do it.  Don't forget to lead it a bit.

Tue, 04/26/2011 - 21:10 | 1209800 grunk
grunk's picture


Mitt Romney: "I'm Not Going To Focus On The Fed"

Tue, 04/26/2011 - 21:22 | 1209828 bigelkhorn
bigelkhorn's picture

Lots of bears out there...u know what that normally means.

There are lots o 1400 On The S&P Coming?

Wed, 04/27/2011 - 01:13 | 1210270 Tail Dogging The Wag
Tail Dogging The Wag's picture

I have to share this music video with you:

It's called "Money in the Bank" and it's very popular with teenagers and young adults at the moment. Timati is a Russian rapper and this video shows how wrong people's perceptions of money are. It made me laugh hard, but also it made me sad.

Wed, 04/27/2011 - 05:36 | 1210540 collinar
collinar's picture

Europe is a maze with no exit.

Tue, 04/26/2011 - 07:20 | 1207109 fredquimby
fredquimby's picture

Made this point in other thread, why the hell are Journo's given the opp to ask questions? They should be there to report not to participate!!

Why are all the USA's leading financiers and economists not invited to question The Bernak?   Them and TD of course....



Tue, 04/26/2011 - 07:27 | 1207121 anynonmous
anynonmous's picture

because the journos are bought and paid for, and in most cases have the economic IQ of a typical CNBSer; this dog and pony show is the equivalent of the bank stress tests designed to provide comforting soundbites for the sheep who get their truth from the nightly news

Tue, 04/26/2011 - 07:48 | 1207168 AnAnonymous
AnAnonymous's picture

Why are all the USA's leading financiers and economists not invited to question The Bernak?   Them and TD of course....


You expect a better result by that?

Economics are rotten to the core; they knew what they were setting up and were looking for the current result. All you will get is a circus discussing technicalities.


Actually, I read only one economist who dared to address the massive theft the US has committing over the rest of the world and he was an Indian.

Economists are part of the show, they only speak to cover up for the US.

Tue, 04/26/2011 - 09:36 | 1207486 fredquimby
fredquimby's picture

Fair point, I guess it wouldn't really make a difference....Maybe one of them will ask a TD question after visiting here!!


Tue, 04/26/2011 - 17:37 | 1209262 disabledvet
disabledvet's picture

indeed.  "When did less is more" become "in fact more is more while less is less now give me more while you all get less."  And who is Palmer Cash?   Is that a grease smudge on her cheek?

Tue, 04/26/2011 - 07:30 | 1207115 Dr. Impossible
Dr. Impossible's picture

...21...when will you, and your accomplices, be submitting yourself to the citizens' arrest issued by Mike Moore. And face a Jury of the People, as the law calls for? And, are Federal funds/deficite spending/National credit being used for "Federal Reserve"  security purposes, preventing "The People" from pursuing justice in these matters?

Tue, 04/26/2011 - 07:39 | 1207145 gordengeko
gordengeko's picture

I was with you until you said Mike Moore.  Then my mind went dumb.

Tue, 04/26/2011 - 07:50 | 1207167 Dr. Impossible
Dr. Impossible's picture

Well...Mike Mooore was the idiot that video recorded himself doing it, then pubished it.

Tue, 04/26/2011 - 10:15 | 1207637 RockyRacoon
RockyRacoon's picture

So you only want Bernanke arrested by someone you like.  I see.  Your mind was hyper-alert, and then went back to normal.  

Tue, 04/26/2011 - 11:25 | 1207903 gordengeko
gordengeko's picture

Not me no, I'd like to see Glen Beck and Ann Coulter arrest him actually.  Since it's all theater anyway.imo

Tue, 04/26/2011 - 07:20 | 1207116 Dineroguru
Dineroguru's picture

Here is one more question for Benny...and more directly to the point.  Who do you like to blow best?  Jamie, Lloyd, the current mope at BofA, or fill in the blank with your favorite member of the financial cabal...

Tue, 04/26/2011 - 07:29 | 1207128 I am Jobe
I am Jobe's picture

LOL. More like who makes him swallow. Time to hang the bitches, WS, SEC, CFTC, SIPC, and many more. Don't forget congress

Tue, 04/26/2011 - 15:05 | 1208651 dumpster
dumpster's picture

okay bernike... define Merkin ,

and why are you one?


Tue, 04/26/2011 - 07:25 | 1207125 corndog
corndog's picture

Please run for office.

Tue, 04/26/2011 - 07:36 | 1207133 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

Question 22:

Which is your preferred method of execution for your genocidal crimes?



Asking this human filth decent, worthy questions like the 21 above only gives him credibility. He is not credible, he is a criminal working in the interests of his masters at the detrement of the masses.

Tue, 04/26/2011 - 11:22 | 1207899 traderjoe
traderjoe's picture


Tue, 04/26/2011 - 07:37 | 1207141 FLETCH
FLETCH's picture

22) Mr Bernanke, how do you sleep at night?  How much Ambien do you take?  During this sleeplessness, is that when you perfect your beard line? 

Tue, 04/26/2011 - 07:45 | 1207157 lance_manion
lance_manion's picture

Mr Bernanke, how do you sleep at night?  

 - On a big pile of money.

Tue, 04/26/2011 - 08:16 | 1207228 dearth vader
dearth vader's picture

Oh no, the Bernank's money is purely imaginary.

Honestly, I think he must be money averse, as he's giving it all away.

Tue, 04/26/2011 - 11:34 | 1207948 The Alarmist
The Alarmist's picture

It may be imaginary, but it is soooo soft .... and there is so much of it.  If Reagan were trying to describe it to us, a stack of it would reach to heaven, where we would meet the annointed one, O, himself.


Tue, 04/26/2011 - 07:37 | 1207142 digalert
digalert's picture

Question 23:

Does the thought of prison with a roommate named Bubba bother you?

Tue, 04/26/2011 - 07:43 | 1207150 xamax
xamax's picture

Question 24:

Are you proud that you will be quoted many years from now in history books as the man who destroyed the world financial system which brought war and chaos ????    

Tue, 04/26/2011 - 07:49 | 1207155 Miles Kendig
Miles Kendig's picture

Lizzy should be working the presser. 

Too bad the fed believes absent wage inflation there is no inflation.  Lemonheaded fedfoolery.

Tue, 04/26/2011 - 07:49 | 1207164 hugovanderbubble
hugovanderbubble's picture



From: Browne, Erin [ICG-MKTS]
Sent: 25 April 2011 14:17
Subject: WSJ: Mkts Get Ready to Navigate Fed's Departure

Brief comments below.  This has not been distributed externally.


Jon Hilsengrath is regarded as having an ear into the Fed's thinking, and his articles are closely followed as a result. His latest post details the Fed's April 27 FOMC meeting.


There is clearly a lot of disagreement amongst Fed officials regarding the sequencing and timing of QE's exit.  What is clear is that the Fed will end QE on June 30, and at this time does not see the need for additional QE measures.  What is unclear is how the Fed will proceed from here.


The first measure to be determined will be when the Fed ends its reinvestment of mortgage proceeds.  The total amounts to ~$15BN a month in 2011, and about $25BN in 2012.  While small in size, the significance in my mind is more optical as an end to the reinvestment will signal a shift in Fed policy to tighten liquidity.


The second question will be how and when the Fed will start withdrawing liquidity.  There is a debate within the Fed as to whether to raise rates first, or to sell down its portfolio first through term deposits and reverse repos.  As of now it seems unclear as to how the Fed will proceed.    


Either way, the path for Fed policy from here is less clear, and will not provide the same tailwind for stocks going forward.  I expect the path of equity appreciation to pause in the intermediate term until the market can get a clearer sense about what the impact of the end of QE means for risk assets, and more importantly, the economy.




Markets Get Ready to Navigate Fed's Departure

For Policy Makers, Next Great Debate Is How to Tighten



As the Federal Reserve waits for the right moment to begin tightening credit, it is working at hashing out a plan for how to do it.


Though the Fed is still months away from actively unwinding its easy-money policies, the intensity of the internal discussion about how to tighten has picked up in recent weeks. It is likely to be debated, though not resolved, when Fed officials meet Tuesday and Wednesday


The first step toward a tightening is fairly straightforward: stop easing. The Fed is widely expected to end its planned $600 billion of Treasury purchases in June.


After that, the act of tightening policy, once it begins, gets more challenging.


The Fed likely will embark on some combination of raising short-term interest rates and reducing more than $2 trillion of Treasury and mortgage securities on its balance sheet.


But in doing so, it faces several challenges.


First, the short-term interest rate that it controls, the federal-funds rate at which banks lend to each other overnight, could be harder to push up than in the past. The Fed has pumped so much money into the financial system that banks are flush with reserves, and that supply will work to hold the rate down.



Next week, Ben Bernanke for the first time ever will take questions from journalists after a Fed policy meeting. WSJ's Jon Hilsenrath reports from Washington on the Fed chairman's new media policy.

Second, the Fed's purchases of longer-term securities, an effort to keep long-term rates down and aid the economy, left the Fed bank with $1.3 trillion of long-term Treasury debt and $934 billion in mortgage-backed securities. Over time, officials want to reduce these holdings.


One early step the Fed might take is ending the practice of reinvesting proceeds when the Fed's Treasury and mortgage securities mature or are paid off. This would effectively shrink the Fed's portfolio, amounting to a slight tightening of policy.


Louis Crandall, a money market analyst with Wrightson ICAP LLC, estimates that $15 billion of mortgage debt would run off the Fed's balance sheet monthly in the second half of the year if not reinvested, and $5 billion of Treasury securities would run off and $25 billion in total per month in 2012 would run off.


Sending a Message

Even that relatively small move raises questions: Should the Fed allow only its mortgage-securities portfolio to run down, as it did last year, or should it also whittle down its Treasury portfolio?


And what message does it want to send to the markets: a loud signal that more significant steps toward higher short-term interest rates are approaching, or that it is on a gradual return to normal?


A year ago the Fed sketched out a rough plan for tightening: Use the short-term interest rate as the main lever and sell the securities gradually over a long time in a predictable way.


Many officials want to stick with that plan, but they and staff are re-examining the whole exit strategy, according to several people involved in the discussions and meeting minutes. One goal is to have plans in place in case the Fed needs to move fast or slow.


"In light of uncertainty about the economic outlook it was seen as prudent to consider possible exit strategies for a range of potential economic outcomes," Fed officials concluded in March, according to minutes of their last meeting.


Views Inside Fed Differ

Narayana Kocherlakota, president of the Federal Reserve Bank of Minneapolis, has said he would prefer separating the Fed's plans for shrinking the balance sheet from its plans to tighten credit.


"You can't separate them entirely," he said in an interview last month, "but I would prefer to be doing the balance-sheet normalization over a sufficiently long period of time that it's not getting in the way of day-to-day monetary policy."

While others are leaning that way, too, it isn't the clear consensus.


Federal Reserve Bank of Philadelphia President Charles Plosser said in a recent speech that he prefers "raising rates and shrinking the balance sheet concurrently and tying the pace of asset sales to the pace and size of interest-rate increases."


James Bullard, the president of the Federal Reserve Bank of St. Louis, wants to sell securities before raising rates.


Senior Fed officials believe they will be able to push up the fed-funds rate, the traditional benchmark for short-term interest rates, but not by the usual means of simply selling relatively small amounts of Treasury securities to soak up bank reserves.


Instead, they are looking at a new tool, raising the interest rate that the Fed pays banks on cash kept on reserve with the central bank.


When the Fed decides to tighten, the plan is to raise that rate from its low level of 0.25%. Because no bank will lend to another bank at a rate lower than it can get at the Fed, increases in interest paid on reserves will, the Fed figures, pull up the fed-funds rate—and with it other short-term rates. It will also soak up some reserves with technical operations, such as a practice called reverse repos in which the Fed lends out Treasury bonds.


This and other steps will require clear, considered communication, a big focus inside the Fed these days, because such moves are so novel, the U.S. economy remains far from full strength and because financial markets around the global are fixated on the size of the Fed portfolio.


Selling securities could be especially hard to calibrate. The Fed's rule of thumb is that a $200 billion change in its holdings is roughly equivalent to a quarter-percentage-point change in the federal-funds rate.


But there are questions about the impact of such sales. Some Fed staff are pondering whether asset sales might have outsized effects on longer-term interest rates and thus on parts of the economy most sensitive to those rates, such as housing.


Rate Expectations

Before it moves to the exit, and that could be a while, the Fed is sure to signal that its views are shifting.


One early sign could be a shifting public view on inflation expectations, which are being closely followed by central bank officials.


They see long-run expectations as stable, but if that view shifts it might signal they are becoming less comfortable keeping policy so easy.


A clearer signal that interest rates will increase will be when the Fed drops from its formal postmeeting statement the assurance that short-term rates will remain low for an "extended period."


Write to Jon Hilsenrath at


Tue, 04/26/2011 - 15:29 | 1208735 bothsidesnow
bothsidesnow's picture

Reverse repos will begin soon. Fed has no choice with 16 cents of monetary base per dollar of GDP. If they do not withdraw monetary base the only way for the ratio of monetary base to GDP to move towards historical levels (about 10 cents for every dollar of GDP) is for prices to inflate the GDP.

The Fed has a dual mandate of inflation and employment. The Fed will not allow further inflation to occur because it would affect employment by reducing profit margins.

Unfortunately the new normal unemployment rate in the US may be in the 6 to 8 percent range.

Tue, 04/26/2011 - 07:49 | 1207173 Everybodys All ...
Everybodys All American's picture

Would you like to be hung with a nylon rope or executed by firing squad for your deliberate debasing of the dollar?

Tue, 04/26/2011 - 07:50 | 1207178 sasebo
sasebo's picture

Question 24:


Have you always been delusional or is this a recent occurance?

Tue, 04/26/2011 - 07:54 | 1207181 bobby02
bobby02's picture

#15 is a good point, but the Fed's NIM is always positive, partially offsetting the duration risk. Still, a 1% rise in rates would wipe out equity on paper if they hadn't changed the accounting rules to create a contra-liability to Treasury to book any losses.

#21 addendum: Which of the big banks would have negative equity if mark to market were in place? Does the Fed guarantee all counterparty risk associated with such banks?

Tue, 04/26/2011 - 09:28 | 1207464 bobby02
bobby02's picture

A back of the envelope analysis of the Fed’s holdings of Treasuries, Agencies and MBS (92% of total assets) suggests a weighted average maturity of 5.88 years, at which point on the curve the yield is around 2.5%. Applied to $2.67 trillion in total assets, that would throw off $67b a year.

Less $4b in interest expense (@ 15bp liability margin) and another $4b in operating expenses, that leaves $59b in new equity. Maybe they could survive a 1% rise in rates if it didn’t happen too fast?

(I guess I had too much free time today.)

Tue, 04/26/2011 - 07:54 | 1207185 snowball777
snowball777's picture

25: How does it feel to know that you've done such a terrible job that the institution you lead will most likely be abolished in the near future?

Tue, 04/26/2011 - 17:57 | 1209312 disabledvet
disabledvet's picture

are you a chef?  or is that your Samurai outfit?

Wed, 04/27/2011 - 07:48 | 1210697 snowball777
snowball777's picture

For the thousandth time, don't put my knives in the dryer!

Tue, 04/26/2011 - 08:02 | 1207193 Boilermaker
Boilermaker's picture

Great questions!  Too bad none of them will be asked.

I can see Liesman lobbing in some pre-discussed softballs.

This will be a laughable joke.

I expect:

"QE has been a success on many levels.  Can you tell the American people some of the areas in which they've benefitted the most?"

"The job market has been rebounding strongly recently.  But, the road ahead is going to be longer than acceptable.  Can you speak to what the average person on main street should expect?"

Blah, blah, blah...

Tue, 04/26/2011 - 16:42 | 1208521 hedgeless_horseman
hedgeless_horseman's picture

Boilermaker, reading your highly probable expectations made me throw up a little into my best coffee mug.  It's people like you that cause unrest.

In my fantasy world, some additional questions would be: 

Q)  Chairman Bernanke, please tell the American people what is the approximate enterprise value of your private organization, the Federal Reserve Bank of the United States, and who are the ten largest shareholders of its member-bank ownership, along with their nationalities?

Q)  Chairman Bernanke, the Federal Reserve Bank is tasked with regulating the very same banks that own it.  How is this not a conflict of interest?

Q)  Chairman Bernanke, the journalists asking questions here today work for media corporations, most of which employ economists that are frequently interviewed by these same corporations and held out as experts, or write news or opinion content directly.  Some of them are in this room.  Can you name any economists employed by these news organizations in this manner that have not previously worked for you, the Fed, or any other central bank?

Q)  Chairman Bernanke, how many central banks, such as the Federal Reserve, has the United States of America had in the past, and, in general, is it not the case that the country survived and indeed thrived after each of them faced their demise? 

Q)  Chairman Bernanke, you have orchestrated the bail out of your organization's member banks with billions of dollars of taxpayer debt.  Consider that President Andrew Jackson was quoted as saying the following:

I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the Bank. You tell me that if I take the deposits from the Bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves...

Are things any different, today?  If so, then how, exactly? 

Tue, 04/26/2011 - 07:58 | 1207197 Everybodys All ...
Everybodys All American's picture

Do you realize the US is likely to lose their reserve currency status because of your leadership while at the Federal Reserve?

Tue, 04/26/2011 - 08:00 | 1207200 slaughterer
slaughterer's picture

Applause for the above questions... all of them probing the touchy issues and revealing the falsities of the Fed in their very formulation.  I hope a few of the MSM journalists have the guts to step up to bat with a few.   Saves them a few hours preparation, so that they can sleep on the plane: ZH is doing their work for them.

Tue, 04/26/2011 - 08:06 | 1207208 petaloka
petaloka's picture

#25 Boxers or briefs?

Tue, 04/26/2011 - 08:04 | 1207209 Boilermaker
Boilermaker's picture

And the futures now climbing like hell just to ice the cake for the masses.  Surely, they'll ramp the damn thing 100+ on the DOW just to set up the 'positive' effect arguement.

My god...just stop it.

Tue, 04/26/2011 - 08:07 | 1207211 aVian
aVian's picture

I conclude denninger is an asshat

Tue, 04/26/2011 - 22:22 | 1209976 New Survivalist
New Survivalist's picture

Have you heard his Monday blog shows? His word is the end of it. Closed-minded. Hell, I'm prepared to see deflation if it comes, but he is not prepared to admit inflation is a bigger possibility. Total megalomanic asshat.

Tue, 04/26/2011 - 08:07 | 1207212 Cdad
Cdad's picture

How many shares of the dipping Netflix should average Americans buy in order to benefit from the Fed mandated wealth effect?  What is the Fed's price target for the Russell 2000?

Tue, 04/26/2011 - 14:48 | 1208599 TruthInSunshine
TruthInSunshine's picture

Dear Channeling-The-Spirit-of-Nero Mr. Bernanke,

Can you please tell Americans what number you have deemed appopriate for the Dow, Nasdaq, S&P 500 and Russell 2000, along with commodity prices by this time next year?

In fact, could you see to it that The Federal Reserve post the exact levels and prices and target dates on its website?

That would help many people and their wealth effect, because it would remove any uncertainty they may have as to whether they should buy, hold or sell.

Tue, 04/26/2011 - 08:08 | 1207214 falak pema
falak pema's picture

Q# 26 When do you plan to emigrate to China?

They have you scheduled to receive the Mao Medal as a benefactor of Humanity and a Hero of the Socialist central planned cause. (True son of Groucho Marx less the mustache plus the Romanov beard).

Tue, 04/26/2011 - 08:12 | 1207219 sbenard
sbenard's picture

What are the chances that ANY of these questions will be asked by a complicit press corps?

I say we submit the questions, and if he fails to answer the key points on any of them (as in waffling or dissembling), we impeach him the next day.

Better yet, why not impeach the propaganda press too?

Tue, 04/26/2011 - 08:12 | 1207223 alfred b.
alfred b.'s picture


 one more...

 Everyone knows that the mandates of the Federal Reserve are price stability and employment; but if I were to tell you that its purpose has been dictated by terrorist Dimon and tax-cheat geithner, that it was to transfer the wealth from the middle-class to the filthy rich, would I be lying?

a follow-up

 How much un-encombered gold is really held @ the Federal Reserve in the name of the US Treasury?



Tue, 04/26/2011 - 08:18 | 1207232 ugmug
ugmug's picture

#21 - Who will win American Idol and why?


Tue, 04/26/2011 - 08:24 | 1207233 Seasmoke
Seasmoke's picture

Who signs your pay check ?

Tue, 04/26/2011 - 08:20 | 1207239 pauldia
pauldia's picture

Fat Chance on any of these questions. You have Fed shills like Liesman  and WASHPO/Bloomberg partnership, etc asking for clarification on a policy statement intended to be Chameleon. This is no different from the choreographed "pressers" from Obama, the two or three that he has had. While most will hang onto every word, I'll be watching the central banker of China or the movement of the sixth fleet. Wed's is a diversion and we all know that QE3, whiles disavowed, will appear after the sheeple are sheared. The only question is the Nome “Nom du Jour”  of said monetizing ? Nevertheless, lets offer a prize for the most useless tool bag at the "news conference". How about a crisp new Federal Reserve Note with Tim Geithners signature?


Tue, 04/26/2011 - 08:27 | 1207248 topcallingtroll
topcallingtroll's picture

Number 11 is particularly important.

It will be easy to identify the illegal frontrunning and prove the chinese walls supposed to separate proprietary from order flow dont exist.

That would be an easy felony or two for Holder if the bernanke would just identify the dealer.

Tue, 04/26/2011 - 08:29 | 1207251 Kristian
Kristian's picture

I don't think he reads ZH.

Tue, 04/26/2011 - 17:42 | 1209279 disabledvet
disabledvet's picture

every one around him does.  for all we know some of them are actual contributors!

Tue, 04/26/2011 - 20:30 | 1209731 Hugh G Rection
Hugh G Rection's picture



RoboTroll, MethMan

Tue, 04/26/2011 - 08:34 | 1207264 oogs66
oogs66's picture

The actual questions that will be asked:

'Mr Chairman, first let me congratulate you for helping us through this crisis, you did an amazing job.  My question is, was it you specific knowledge of the Great Depression or just general academic brilliance that allowed you to be so successful at this difficult task?"


"Mr Chairman, I just want to thank you on behalf of the American people for saving our financial system.  My question is, does it make sense for you to also take over the role of ECB chairman so that you can co-ordinate global policy and share your expertise?"


"Mr Chairman, although its already been said, I too just wanted congratulate you on your stellar performance.  Now, how difficult is it to explain to the non economists, that rising oil prices are deflationary?  Personally, I'm shocked that people can't understand the simple concept that higher prices are deflationary, but how do you deal with having to explain such simple concepts to the average person who doesn't have the intellect to deal with the subject matter?"


"Mr Chairman, I just wanted to let you know that I sleep soundly every night, knowing that you are at the head of the ship, steering our economy through these troubled times.  It seems to me that most of the data is understating the recovery, don't you agree?"


Tue, 04/26/2011 - 09:09 | 1207372 Village Smithy
Village Smithy's picture

Nicely done.

Tue, 04/26/2011 - 08:35 | 1207266 sbenard
sbenard's picture

Just impeach Bubbles Bernanke and spare us the lies!

Tue, 04/26/2011 - 08:44 | 1207272 rich_wicks
rich_wicks's picture

I just want to say a few thousands words:

Red line is projected debt if it grew at 9.4% a year, and as you can see, it pretty much does.  It reaches 33 trillion by 2020.

Tax revenue and debt plotted on the same graph

As a percentage relative to one another:

The value of the debt in troy ounces instead of dollars:

So stop asking stupid questions.  Stupid questions are questions that you know the answer to, or should be able to figure out for yourself.  You see those graphs?

America is nearly done.  Stick a fork in it.  Gold is not a bubble, silver is not a bubble.  Sure they've had an incredible run up, but they are NOTHING compared to the run up in debt.  Everybody owns freaking US debt.  How many people own an ounce of gold or silver?  Yet, governments have trillions of dollars of debt and a few billion dollars in gold.

There is less than 10 trillion dollars worth of gold on the planet at current market prices.  Don't you get it?  We're living in the bizarro exceptional time now.  It's not different this time.  We're reverting to a 7000 year mean.  Paper money always fails.  We're no different.  Don't think this time it's different, it's not. 

Tue, 04/26/2011 - 08:41 | 1207276 TexDenim
TexDenim's picture

If not how would you explain this phenomena?

"This phenomena?" The singular of phenomena is phenomenon. Elementary errors in grammar make posts hard to read because they distract from the content and focus on the form.

Tue, 04/26/2011 - 08:45 | 1207297 Tyler Durden
Tyler Durden's picture

We also misplaced two commas on purpose... You know, just in case we are taken seriously.

Tue, 04/26/2011 - 14:59 | 1208633 topcallingtroll
topcallingtroll's picture

Just hold onto them.
You can probably use them later.

Wed, 04/27/2011 - 03:08 | 1210371 Yen Cross
Yen Cross's picture


Tue, 04/26/2011 - 20:47 | 1209761 Wakanda
Wakanda's picture

Good idea to avoid that nonsense.

Go for being taken as a foolish, much fun follows!

Wed, 04/27/2011 - 04:47 | 1210420 Yen Cross
Yen Cross's picture

Quotes are worthless these days! Smiles! (except your's of course)

Tue, 04/26/2011 - 09:16 | 1207412 Loose-Tools
Loose-Tools's picture

Just go wash your hands 100 times, count your toothpicks, and you will feel better!

Tue, 04/26/2011 - 09:33 | 1207478 Boilermaker
Boilermaker's picture

"This phenomena?" The singular of phenomena is phenomenon.

This is 'your version' of perfect grammar?

Tue, 04/26/2011 - 09:43 | 1207510 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

Read a couple of major newspapers each day and the grammatical and typographical errors will start to seem like just a normal part of the landscape.

Tue, 04/26/2011 - 11:21 | 1207891 HK
HK's picture

For all you grammaphobics out there, please read this, then apologize to Tyler, for he hosts such a wonderful FREE site and fuck your t's and i's:


Wed, 04/27/2011 - 05:33 | 1210534 Yen Cross
Yen Cross's picture

I donate. Anonymously! Libmites might consume luggage otherwise! Pesky critters like vinyl!

Tue, 04/26/2011 - 09:56 | 1207556 LMAO
LMAO's picture

You were actually trying to say:

"Elementary SEC-like porn surfing makes posts hard to read because they distract from the content and focus on   .    .   . avatars"


Tue, 04/26/2011 - 08:40 | 1207279 ViewfromUnderth...
ViewfromUndertheBridge's picture

Good job TD,'s hoping someone in the room picks up the baton.

Tue, 04/26/2011 - 08:44 | 1207283 razorthin
razorthin's picture

21. Which would you prefer:

a. Hanging

b. Electrocution

c. Gas Chamber

d. Lethal Injection

e. .454 Casull to the skull

Tue, 04/26/2011 - 08:55 | 1207339 snowball777
snowball777's picture

Which is most expensive to you?

Tue, 04/26/2011 - 08:49 | 1207303 Fox-Scully
Fox-Scully's picture

Question 23:  Based on your performance, why do you think you still have a job as Fed Chairman?

Tue, 04/26/2011 - 08:49 | 1207304 Cassandra Syndrome
Cassandra Syndrome's picture

26. When you pray, do you chant in Latin and do you address him as Satan, Lucifer, the devil or beelzebub?

Tue, 04/26/2011 - 08:59 | 1207348 snowball777
snowball777's picture

Ugaritic...and I dare not speak its name.

Wed, 04/27/2011 - 01:40 | 1210309 Yen Cross
Yen Cross's picture

Nice to see you back SnowBall! I have missed your snappy remarks. Hope you're well.

Tue, 04/26/2011 - 08:51 | 1207306 razorthin
razorthin's picture


Tue, 04/26/2011 - 08:48 | 1207311 medicalstudent
medicalstudent's picture

since the benificient premise is flawed, these questions are moot and rhetorical.


but good.

Tue, 04/26/2011 - 08:55 | 1207318 Henry Chinaski
Henry Chinaski's picture

Dr. Bernanke:  Does the fed policy of deliberately devaluing the dollar through QE + ZIRP have the same effect setting fed funds at a negative interest rate?

(If your only tool is a hammer, does everything look like a nail?)

Tue, 04/26/2011 - 08:51 | 1207325 swissaustrian
swissaustrian's picture

"Fed officials will limit attendance to those who represent news organizations accredited by Congress and only one per organization" (Hilsenrath, WSJ)

Read: Censorship

Tue, 04/26/2011 - 12:12 | 1208095 Rainman
Rainman's picture

....and all in attendance must remove their shoes before entering.

Tue, 04/26/2011 - 08:55 | 1207329 ak_khanna
ak_khanna's picture

You will have to get the questions approved by the too big to fail banksters before Ben, Geithner or Obama can answer them. The puppets will do and say only what their masters want them to do or say. Nothing more nothing less.

Tue, 04/26/2011 - 08:59 | 1207344 LongSoupLine
LongSoupLine's picture

Bonus, bonus, bonus question:


23. You said, under Congressional oath, you would "not monetize the debt".  POMO operations clearly show that is what's occurring.  Could you explain how this is not perjury since the answer you gave was from very clear concise questioning?

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