defensive. He spent most of is talk describing in some detail why the
Federal Reserve and its cheap money policies of ZIRP and QE have not
added to the inflation picture.
IMHO Ben should have stepped up to the plate and said to the world that
in fact his policies have contributed to inflation. He should have
confirmed, what we already know, the objective of current monetary
policy is to stimulate inflation. After all, the idea that zero interest
rates do not contribute to inflation is, well, a dumb idea that has no
basis in fact.
While Ben was doing his best to convince the suckers that believe in his
drivel the NY Fed was publishing a blog that concluded quite the
opposite. (Link)
The title of this chart from the report says it all:
The report looks at what is rising in price. It equates it to what we
actually consume. For example, while the fact that Tenant’s Insurance
has fallen in cost is important to the CPI, it has little to do with
what we actually spend money on. The conclusion from the NY Fed:
84 percent of all expenditures in the CPI basket were on items that experienced above-average increases in inflation in the last seven months.
The bottom line is that Ben can’t fool me. He can’t fool the economists
at the NY Fed. He can’t fool the market. So just who is he trying to
fool? I think he is trying to fool himself.
Precisely why possession of real assets goes from being nine tenths of the law to being the law in a fraudulent economic and monetary system. The real economy does not care what the BLS says.
And massive business failures when the market shrinks.
Yes, precisely why the whole "flation" debate is pointless. No price can be paid if there is no money (in whatever form that may be) to pay it. Likewise, no "tax" can be collected if there is no productive populace left to collect that tax from (via their commerce, wages, and property).
If you get too cold, we'll tax the heat,
If you try to walk, we'll tax your feet.
...cause I'm the Taxman!
+1
Very well-reasoned arguments there.
:D