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Guest Post: Bernanke Is 100% Sure
Submitted by Jim Quinn of The Burning Platform
Bernanke Is 100% Sure
I don’t know about you, but I’m not 100% sure about anything. The
older I get, the less sure I am about everything. I question things that
I was sure were true when I was 25 years old. I’m not sure I’ll wake up
in the morning. I’m not sure I’ll survive my commute to work. That is
why I was flabbergasted last night as I watched Scott Pelley interview
Ben Bernanke on 60 Minutes. As a side note, boy this show has gone
downhill. In the old days of real journalism, Mike Wallace would have
scorched Ben Bernanke, pointing out his phenomenal ability to be wrong
or clueless on every financial issue the country has faced in the last
10 years. Today, Pelley underhands softball questions to Bernanke and
never challenges him. It was a pathetic display of journalism.
Below is the dialogue that made me almost fall off my chair:
Pelley: Is keeping inflation in check less of a priority for the Federal Reserve now?
Bernanke: No, absolutely not. What we’re trying to
do is achieve a balance. We’ve been very, very clear that we will not
allow inflation to rise above two percent or less.
Pelley: Can you act quickly enough to prevent inflation from getting out of control?
Bernanke: We could raise interest rates in 15
minutes if we have to. So, there really is no problem with raising
rates, tightening monetary policy, slowing the economy, reducing
inflation, at the appropriate time. Now, that time is not now.
Pelley: You have what degree of confidence in your ability to control this?
Bernanke: One hundred percent.
The hubris in this statement is breathtaking. The U.S. economy is a
complex interaction of thousands of variables and is intertwined with
the policies and actions of hundreds of other countries throughout the
world. No one has a handle on the worldwide economy and no model can
predict anything with any amount of accuracy. And still, this pompous
professor from Princeton who has never worked a day in his life in the
real world is 100% SURE that HE knows what will happen and when it will
happen. I’m sure his track record of predictions and analysis will give
you comfort in this statement:
“We’ve never had a decline in house prices on a nationwide basis.
So, what I think what is more likely is that house prices will slow,
maybe stabilize, might slow consumption spending a bit. I don’t think
it’s gonna drive the economy too far from its full employment path,
though.” – 7/1/2005
“Housing markets are cooling a bit. Our expectation is that the
decline in activity or the slowing in activity will be moderate, that
house prices will probably continue to rise.” – 2/15/2006
March 28th, 2007 – Ben Bernanke: “At this juncture . . . the
impact on the broader economy and financial markets of the problems in
the subprime markets seems likely to be contained,”
May 17th, 2007 – Bernanke: “While rising delinquencies and
foreclosures will continue to weigh heavily on the housing market this
year, it will not cripple the U.S.”
June 20th, 2007 – Bernanke: (the subprime fallout) “will not affect the economy overall.”
October 15th, 2007 – Bernanke: “It is not the responsibility of
the Federal Reserve – nor would it be appropriate – to protect lenders
and investors from the consequences of their financial decisions.”
February 29th, 2008 – Bernanke: “I expect there will be some
failures. I don’t anticipate any serious problems of that sort among the
large internationally active banks that make up a very substantial part
of our banking system.”
June 9th, 2008 – Bernanke: Despite a recent spike in the nation’s
unemployment rate, the danger that the economy has fallen into a
“substantial downturn” appears to have waned,
July 16th, 2008 – Bernanke: (Freddie and Fannie) “…will make it
through the storm”, “… in no danger of failing.”,”…adequately
capitalized”
September 19th, 2008 – Bernanke: “most severe financial crisis”
in the post-World War II era. Investment banks are seeing “tremendous
runs on their cash,” Bernanke said. “Without action, they will fail
soon.”
As you can see, he has been a regular Nostradamus with his predictions.
Whenever I see Bernanke or Obama seek to go on 60 Minutes I get the
impression they are getting desperate. Last night was nothing but a PR
effort by Bernanke because he is losing control of the situation. Our
entire financial system is nothing but a confidence game. During the
interview, Bernanke made two BIG LIES. He said that buying $600 billion
of US Treasuries would reduce long term interest rates.
When Bernanke made it clear he would institute QE2 in early October
the 10 Year Treasury was at 2.4%. Today, it is 3.0%. Mortgage rates are
tied to the 10 year Treasury. They are rising, not falling. Bernanke is
lying. His sole purpose for QE2 is to make the stock market go higher,
enriching his Wall Street masters.
His 2nd BIG LIE is that there is no inflation. In his little world of
models there is no inflation. In the real world, where we live there is
plenty of inflation. I guess his limo driver doesn’t tell him that gas
now costs $3.25 a gallon. Let’s assess his no inflation lie:
- Oil is at $89 a barrel, up 21% in the last year.
- Gold is trading at $1,413, up 23% in the last year.
- Silver is trading at $30, up 66% in the last year.
- Copper is trading at 4 per pound, up 26% in the last year.
- Corn is trading at 573 a bushel, up 49% in the last year.
- Soybeans are trading at 1,300 a bushel, up 23% in the last year.
- Wheat is trading at 779 a bushel, up 41% in the last year.
- Pork is trading at 104 a pound, up 23% in the last year.
- Beef is trading at 106 a pound, up 28% in the last year.
- Cotton is trading at 130 per pound, up 78% in the last year.
- Sugar is trading at 29 per pound, up 32% in the last year.
- Coffee is trading at 205 per pound, up 40% in the last year.
If you think these figures couldn’t possibly be correct, go to this link and verify for yourself.
http://money.cnn.com/data/commodities/
Evidently, Mr. Bernanke thinks that the sheeple will just believe him
because he is the Federal Reserve Chairman. The truth is that only two
things are deflating: middle class wages and home prices. Bernanke
certainly has chutzpah when blatantly lying to the American public about
inflation. I’m sure none of you drive cars, heat your homes, eat food,
or wear clothes.
I’m 100% sure that Ben Bernanke will be wrong again. He will
ultimately be known as the professor that never saw the collapse of the
USD coming.
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Exactly...I am definitively 100% offended by this arrogant remark. Hell, I'm only 95% sure The Bernank should be fired.
LOL.
How Bernanke Is Using the Printing Press to Win Friends and Influence People | Robert P. Murphyhttp://www.youtube.com/watch?v=BARmYUkdQUE
When the head of the Federal Reserve and (arguably) the most influential financial person on earth shakes due to nervousness when not even facing tough questioning, then you know he's hiding a hell of alot.
After the implosion, he'll be fine because his memoirs about how much he knew and how close to the brink he straddled the economy will be an interesting read anyway. I'm sure the book will sell well.
If he gets out alive, he will go into hiding like Hank "the Undertaker" Paulson. I noticed his lips were quivering uncontrollably during the interview. Hopefully someday soon someone will get to waterboard the Ben Bernak on PPV. In the meantime, support Ron Paul's appointment to the chairmanship of the Monetary Oversight Commission.
>> Hopefully someday soon someone will get to waterboard the Ben Bernak on PPV.
Aw hell. Then I'll HAVE TO break down and get cable.
Does Bernanke Have an Exit Strategy? | Robert P. Murphyhttp://www.youtube.com/watch?v=dZf3Qye0BtQ
Bernanke reminds me of Robert Citron.
I am 100% sure Bernanke will end up making Arthur Burns look like a great Chairman of the Fed when all is said and done.
It was funny and worrisome to see Da Bernank's Face making strange moves while lying his but off! I used to be a big fan of 60 Min well not anymore!
A body language expert ought to have a field day.
Ya know - a "terrorist" security expert who ferrets out lying would have some fun, too.
Pete
Not quite up to the level of veracious discomfort evidenced in the face as Chief Inspector Dreyfus, but another "60 Minutes" performance could bear it out.
http://i2.ytimg.com/vi/LEcsgbwBFRs/0.jpg
Goes without saying that those who have been given absolute power will believe they are actually deserving and have all the answers.
The Bernank is a fanatic a true believer.
Frankly, I'm 95% sure we should put the Ben Bernank on suicide watch. If he ever realizes that he is nothing more than a useful idiot, well, it might be more than he could take. He seems very shakey to me.
Ha ha, exactly. Who actually believes that the BenBernank is actually in control of anything that his handlers don't want him to be.
I am surprised they didn't stick him with one of Barry Seotoro's teleprompters after this pathetic display:
http://www.youtube.com/watch?v=n0NYBTkE1yQ
I have Parent plus loans for 4 of my adult children. This is a short letter that I sent to the Fed, and my local senator today:
The Middle Class, Unemployment and Education
Education is a major factor in obtaining a job. The degree of education in a population has shown direct correlation with the unemployment rate. The government and Federal Reserve need policies to help employment and the middle class deteriorating income and employment numbers. Therefore, lowering debt burdens of the middle class should be a high priority of the government to promote spending, GDP, and employment. It would be very helpful for the government sponsored Parent Plus Loans to have a lower rate than the current 7.9%. The banks receive rates close to zero. The government implies that it would like to get money to the middle class. They have an avenue through these Parent Plus loans to help middle class parents, who are able to qualify for these loans easier than they are able to qualify for bank loans. Yet the government and their bank conduits continue to charge exuberant rates that are basically pillaging the middle class incomes, while the banks get a low interest rate free ride to invest in treasuries and other assets for a guaranteed profit. What is the logic in these actions?
Bernake is afraid of deflation. However his gratuitous relations with the banks allows the banks to drive up the price of assets that people need like energy (gas), food, education, and healthcare. The banks like Goldman are taking the low interest QE loans and investing in these assets and their derivatives, thus the dissonance between the economy, and the stock market and commodities. Bernake says he is not printing money, but it is a matter of semantics. It is just an accounting issue where he digitally adds more zeros to the banks balance sheets after he buys back the treasuries with added fees from the primary dealer banks. Ya, Bill Clinton didn't have sex with Monica either.
Don't worry, Bernank will burn in hell for this.
Not if he believes Jesus died for his sins.
what needs to happen is the cost of higher education should come down. The answer is not higher supplies of credit to cause more inflation there
The cost of higher education will never come down ... it was deliberately leveraged up over the past two decades as a payoff for the support in brainwashing the children to liberal elite causes by the liberal academic elite who would otherwise be unemployable in the real world.
Check out the salaries of the esteem professors and teachers at some of these colleges. There is a large percentage in the six figures with some at $300k plus. They are just like union public employees that won't take a pay cut.
Can't really disagree, though I'd call them the "statist" elite. "Liberal" is the currently dominant party, but "statist is the core. IMHO.
"It was a pathetic display of journalism."
No, it was a contractually scripted appearance by private entities looking to throw congress and the government under a bus to protect their interests. And yes, I'm 100% confident of this...;-)
@clampit
Yeah, I was wondering myself why Bernanke even bothers with appearances like this. The FOMC must have some media and PR consultants that see these public displays as somehow supportive of their ultimate goals. For the unwashed, his interview will be edited and boiled down to a few ten-second sound bites, and that is all that matters these days.
Why? Because the fed fighting for it's life. Need to show the "people" that they're all about the good of the country. Without risk. No live interview with an unknown quantity, just a well rehearsed appearance at one of the long standing "respected" news organizations under corporate control. Probably could work something out with the PD community on CBS/Time/Warner's next leveraged acquisition...that's the real story here: did the fed have to "pay" for the "privilege" of being interviewed on 60 Minutes or visa versa?
If they wanted people to actually watch it, though, they should have had him appear on Dancing with the Stars.
Only people that can think watch 60 Minutes, even if its just once in awhile such as an occasion to watch, jaw-dropped, a Fed Chair spew out garbage from an upright fetal position.
Cool post.
History might say he never saw this stuff coming. Methinks it is quite the contrary. The more this continues, the more it looks like either a larger game being played - or confluence of all that is social, moral, politically, economically, etc. broken into what amounts to a manifest destiny of fiat currency implosion. Heck, it's probably both! A sick combination of the two... just like marketing working off of people's fears and vanity.
http://hypertiger.blogspot.com/2010/11/better-get-some-hyperinflation-soon-or.html
Thanks. Looks like some good reading. Over the last few months I have really firmed up my own beliefs that we are heading for wreck of epic proportions. Now, it really just comes down to what the pain will be and how to see it coming just a tad sooner than the average person. Any reading I can get my hands on that speculates with intelligence in this regard is just what the doctor ordered.
hypertiger is and always has been correct, and is saying the same thing that I have.
But, the problem is the intermingling of monetarist definitions of inflation versus boots on the ground. The latter sees a rise in prices, the former, a contraction in the quantity of money.
These are reconcilable only if you accept what I have been saying, that money, which equals debt, as an INSTITUTION is being discounted in the face of what hypertiger and the rest of all us all maintain - that exponential growth has stopped and the future holds contraction. In the face of a contractionary future UNABLE to pay the yield, much less grow, the value, the "moneyness" of all the existing debt, which IS what we know as the money supply, MUST be discounted with respect to real things.
Because all that outstanding credit base, money supply, is a promise against - collateralized by - future growth which isn't coming. Therefore, even in the face of clear monetarist deflation, we still see debts' value compared to real assets falling even faster. This reflects a confidence problem in the ability of debt to maintain its own viability, for a bond to get "cash value" into a contractionary future, as well as to compete in a scarcity environment with other debt instruments for real production.
I have rather some substantial problem embracing what seems to me to be a contorted, entirely re-imagined, definition of inflation -- in the context of every day life. It is not clear to me that there's any point.
Inflation is an increase in cost of living. Or it always has been. I now see all sorts of lengthy presentation about what it *really* means, but I don't see any evidence that what it *really* means translates to cost of living. Isn't cost of living the only significance to inflation?
We all know the drill on this. Housing and cars have smashed cost of living overall. All the other things we see price increase on . . . those are entirely real, but they are ignoring the two 800 lb gorillas, housing and cars.
It looks pretty clear that deflation is in the future because the engine of growth (increasing oil production) is gone forever. If you are not growing, you do not demand anything not necessary. If you do not demand it, a price increase won't entice you to suddenly start demanding it. You can't raise the price of things no one wants.
So yes, food will go up. Oil will kill us, literally, but enroute to that . . . gadgetry will become relentlessly less attractive. Ditto sports/entertainment. Ditto everything not food or oil. If you don't want it, the price won't go up.
The only way I see what I'd call TRUE, ACTUAL, COST OF LIVING increase in all this is when housing hits rock bottom and people have nowhere to go and so don't demand cars. Then you can get inflation, driven by the little effects of food and incidentals. But while housing is flat or down and cars are flat or down, CPI is not going to spike. It's just not.
And the rub is trying to figure out the behavior of the fiat currency, PM's, etc. relative to the REAL world you mentioned. The point here is to chart a reasonable path (if possible) through the coming implosion of the system - and the warning signs of said system reaching critical mass. Screw investment, materialism, high-profile career, success as measured by the broken metrics of our what has become a lost society... I just want to chart a course to the other side. Would like not to become solient green if possible.
Still reading hypertiger's stuff right now. Seriously anger issues - love it of course. Becoming the "perfect asshole" is sort of hobby of mine (at least according to my wife) - but in a tough-love sort of way of course. The only thing I don't see so far is any consideration about what to do other than accept that if you are not a Rothschild that the best thing to do is get drunk and drive off the nearest pier.
Hmmm... My wife insists that I am the perfect asshole. Can there be more than one?
Alpha persons don't know how a confidence interval is working ;)
I'm 100% sure that America is made up of
1) Youth that suck the cock of Steve Jobs
2) Baby boomers too stoned on weed to look at their 401-K's until they lost 50%
3) Old farts that game the system to death.
Oh, and Ben's beard IS really cool!
Speaking of inflation and prices:
http://www.youtube.com/watch?v=v76PM6-4yGk
Guess who I'm 100% sure will be against the wall and shot during a popular revolt? (Hint: It won't be the limo driver.)
BS...he'll be in Israel with Putin's oligarchs.
I reluctantly agree. If anyone can afford a nice gulfstream jet flight to anywhere on the globe, it certainly is him.
But I can dream, can't I?
I was expecting his mindless rhetoric concerning his methods relating to the markets, so it was the "100%" comment that made me irate. I wrote this last nigh after reading the excerpt:
He epitomizes the academic class. Neo-Keynsian theory has "worked" (for them) for a good part of the last century. How could it fail now?
Bernanke is a liar -- watching 60-Minutes was like watching old Goebbels' videos from the Nazi propaganda archive.
Cream puff interview. Piece of crap. Pelley was lobbing softballs. A terrible waste of time. Shit.
Everyone who is waiting for a dip to buy PMs, you are getting it now. Someone didn't like gold at a new high. Hello Blythe.
You know why Bernake said 100%, he's selling. Could you see through his nervous twitches that he's not a salesman? Could you see the famous poker "tell" when he answered the 100% question that his pulse raced and he swallowed hard? He knew it was time to put it all on the line, yet he's not a public speaker so the flaws show.
Regarding tough questions, hard to do when the interview is scriped before hand. Interviewing should include both tough questions to ask, but more importantly, tough questions formed from the answers given. This takes tallent and knowledge of the subject material and being able to formulate an opinion on the fly. Mr. Pelley has little tallent in this regard.
I am also 100 % sure he can raise rates. It's a few keystrokes on a computer. So there. He speaks truth......But can he really ?
With unemployment at 10% ? With a Trillion dollar hit to the market value of the Feds Holdings (not to mention the crony banks) ? With hundreds of billions in increased Government borrowing costs ? Can you really push that button, Ben ?
And don't forget - he said he can raise rates in 15 minutes. Hmmmmmm. I don't think so. More a question of how fast and how often can he raise rates "when necessary"?
Raise rates in 15 minutes? Counting the time it takes to let the Boyz know? Counting the time it would take for the Boyz to sell out?
Bingo.
I am also 100 % sure he can raise rates. It's a few keystrokes on a computer. So there. He speaks truth......But can he really ?
With unemployment at 10% ? With a Trillion dollar hit to the market value of the Feds Holdings (not to mention the crony banks) ? With hundreds of billions in increased Government borrowing costs ? Can you really push that button, Ben ?
Nail on the head. He'll try to weasel out of these statements like Krugman tried to weasel out of his "we need a housing bubble" statement, by mincing words.
The question isn't "can he push the button" - the questions are:
1. Which of the following will we get first:
and
2. If the former comes first (definitely not a 100% certainty), is Ben smart enough to know when that period has started but the second has not yet?
The movie Casino:
The part where DeNiro's character confronts the hillbilly employee who just allowed 3 slot machines to fraudulently pay out mega-bucks.
He tells the hillbilly's brother in law that he fired him because:
1) If he didn't see it coming, he was too incompetent to be kept on.
OR....
2) He was in on the scam.
EITHER WAY HE'S OUT!
It was all downhill from there...
Commissioner Webb:
"oh and check carefully, because we may just have to kick a kik*'* a** out of town"
The whole Bernanke interview - I thought I was watching a stand up comdey routine.
Mr Quinn
As always you cut through the BS with a lazer beam.
Thanks
The strategy for Wall Street profits was prescribed two years ago:
Deflation in everything you own; inflation in everything you need.
Your house, pension, car are all worth less and less, but your food, fuel and essential services all cost more and more.
It was never prescribed, it was built into perpetual deficits, currency debasement, and consumption spending vs. investment in REAL capital stock. Jobs would have never been offshored if the dollar wasn't a reserve currency. Like any usery scheme, the ones collecting the economic rent end up getting richer and richer, until they own everything. And they're buying large tracts of farmland, outlawing home grown food, even starting to target breastfeeding (check the news today - FDA "might" think it's dangerous).
The minions will need the banksters for their food and water. No way out. No way off the grid.
Point taken, but be realistic - what is he supposed to say? The entire world is watching his comments and any sign of weakness or uncertainty can have a dramatic impact on global markets. I suppose he could have said "as sure as I can be", but that is functionally the same thing.
There's plenty to be upset with the Bernank about, but this is chicken shit, IMO.
He shouldn't say anything --- he shouldn't even be on 60 minutes, or any other program for that matter.
If Bernanke thinks he can set interest rates to 7% without crashing the Treasury he is sorely mistaken. Of course he knows this.
Max Headroom could be a better spokesman for the Fed. Would certainly be more entertaining and the twitching could be explained away as an artifact of digitization.
"Ca-ca-ca-ca-ca-catch the wave!"
The interview was a joke. I would not be surprised if The Ben Bernank was given a list of questions ahead of time so he could screen them.
At a minimum, Pelley should have grilled him over what "inflation" really means to typical Americans. The cost of many important items cost much more than one year ago. Dancing around the CPI data (which excludes food and energy) doesn't cut it when people can't pay the bills.
This interview was a shameless PR stunt.
Go long gold, silver, oil, and food. Inflation problem solved, other than capital gains taxes.
I am many % concerned about how reliant the Bernanke is on the "wealth effect" actually taking the economy up, with the large doses of Fed medication.
He also didn't seem to think it is possible for inflation to take off even as an economy doesn't. He and his brethren are too reliant on the market baskets of inflation including appliances, cars and homes and not looking enough at how food and gas and education (the necessities) costs are moving up despite a sluggish economy.
Can't you see he was lying? It's all a scam to pay for the federal government. Bond purchases are the very first step in the "wealth effect" shell game. If Ben's Blackhawk broke down, the federal government would die a quick death of insolvency.
Ben- "One myth that is out there is that we are printing money, we're not printing money...what we're doing is lowering interest rates by buying tresury securities..."
Inquiring minds would like to know what you are giving the entities that are selling you the treasury securities? Is it cash? If so where is this cash coming from?
I'd be more comfortable with b/js being exchanged for treasuries, then again maybe not because that would really erode the value of a b/j.
Bingo - the logical follow up question SHOULD'VE been, WHERE does the money come from to buy said treasuries Mr. Bernokio?
OT but not so much. I'm trying to rent a couple of apartments in the midatlantic. Not trying too hard, because so few people have jobs, but advertising locally on Craigslist. For the last few weeks, we've been getting calls from folks in Ohio, Michigan, and such... tired of the cold, broke, looking for work, and hoping to make a sane move.
If they are looking for work, they won't find it here. This is getting scary.
What you have to remember though is that all the QE is stuck in reserves. This in itself is not inflationary. Of course, should it come out of reserves quickly then it could be devastating. But for now, it is not, which actually suggests to me that the deflationary effects at play in (real) assets must still be very very powerful. Consumer prices my well be rising (we all know they are), but don't rule out further collapses in asset prices. I am 100% sure of this.
The scope of the mess is breathtaking. In my estimation the root cause of the problem is the political system in the United States is failing or has failed. So Bernanke like any good finance minister before him representing an insolvent court is doing everything he can to fund the soverign hoping the king dies, comes to his senses, gets cured of his syhpillis, gets replaced by the nobles or whatever before it's too late. Meanwhile back at the court the king and the jesters are negotiating about how to make the problem worse with tax cuts.
Ya forgot the additional 13 month's of Anti-Riot payments to the UE!
Every central banker in history could have said the same " can raise interest rates in 15 minutes and kill inflation instantaneosly" - so there should have been no inflationary episodes in history - after all it only takes 15 minutes to stop it.
I can stop drinking in 15 seconds - I mean all I have to do is not unscrew the bottle cap - thats it. Hmm ... maybe tommorrow , I'll stop it in 15 seconds!
100% certain? That's what you say to yourself when you get to the point that you need to reassure yourself.
It's delusional.
Great info Jim.
Debasing the $ is BB's last step in his PhD thesis on this crisis, and in fact is exactly what he wants now that rates haven't worked. From 2002 speech:
"Although a policy of intervening to affect the exchange value of the dollar is nowhere on the horizon today, it's worth noting that there have been times when exchange rate policy has been an effective weapon against deflation. A striking example from U.S. history is Franklin Roosevelt's 40 percent devaluation of the dollar against gold in 1933-34, enforced by a program of gold purchases and domestic money creation. The devaluation and the rapid increase in money supply it permitted ended the U.S. deflation remarkably quickly. Indeed, consumer price inflation in the United States, year on year, went from -10.3 percent in 1932 to -5.1 percent in 1933 to 3.4 percent in 1934.17 The economy grew strongly, and by the way, 1934 was one of the best years of the century for the stock market. If nothing else, the episode illustrates that monetary actions can have powerful effects on the economy, even when the nominal interest rate is at or near zero, as was the case at the time of Roosevelt's devaluation."
http://www.federalreserve.gov/BOARDDOCS/SPEECHES/2002/20021121/default.htm
Great catch. Thanks for sharing this link. Central Planners are destroying us.
I am 100% certain that The Bernank is a hopelessly useless liar and will only do harm to the US and worlds economies.I know 100% for sure anytime politicians try to intervene in financial markets, they are doing the wrong thing and the end result of what they are trying to achieve is exactly the oposite of what they desired.
Never forget the words of Reagan when asked what was the scariest thing he'd ever heard, it was "I'm a politician.and I'm here to help".
Worse than that ,we now have the Bernank trying to print money to buy stocks to convince people they are wealthy enough to buy Chinese goods in the hope that it will create American jobs.....how fucked up is that for thinking?
If the Bernank is stupid or not is irrelevant.
Either he is:
#1, Stupid, and was installed to ignorantly do what he has been doing.
#2, Bright, and was installed to consciously do the wrong thing.
Also, consider the option that there is no alternative to what he has been doing.
Either way, it doesn't matter. He is just the current fall guy. There will be more of them, as things get worse
Sigh. He is NOT doing the wrong thing.
You're making the same argument Douchinger did when I told him with 100% certainty that the Bernank would print (back in 08).
The MATH dictates printing. There is NO OTHER MOVE for him to make on the board. He either prints or the ENTIRE MONETARY SYSTEM comes down in a cascading deflationary collapse. In 2008 alone, we were twice or thrice literally a few hours away from complete monetary collapse as a result of the intractability of the monetary math.
It would be wise for everyone to accept and ultimately make peace with the fact that we have been living in an exponential growth system called "the industrial revolution" for 3 or 400 years and that the growth has stopped.
bernanke is being very clever - misdircting people's attention to the mechanisms by which he can stop inflation/withdraw stimulus. Sure the mechanism is obvious. And of course it only takes 15 minutes .... but. The issue is NOT the mechanism it is the political will. How loudly will the congress critters squeal if rates have to be raised with continuing high unemployment? With the entire economy even more levered up? Yeah - 15 minutes - that wont happen after the 15 months of political debate.
Textbook Type II error.
"His 2nd BIG LIE is that there is no inflation. In his little world of models there is no inflation. In the real world, where we live there is plenty of inflation. I guess his limo driver doesn’t tell him that gas now costs $3.25 a gallon. Let’s assess his no inflation lie:
Wrong understanding of inflation. Rising prices are not inflation. In fact they can be deflationary. Only increases in wages can induce inflation. If there is no rise in income, one can only cut expenses elsewhere to cover the higher costs of needed goods. And if one is unable to cut costs elsewhere, one is in a predicament of collapse which is even more deflationary.
no offence, but thats rubbish.
I don't look at inflation in an academic textbook fashion. I'm paying more for the shit I have to buy = Inflation for me.
Sorry, but for purposes of discussion, you don't get to make up your own definition... This is, imo, the largest hurdle for the inflation debate. I think ultimately, we're all hyperinflationists... we just expect different paths to the inevitable.
Yea ... but overall you are not buying more, unless you are going to buy on credit to keep up. That is what the PTB have been instigating for the last 20 years. The people, except for the top 1%, have not seen incomes rise. So to keep up the lifestyle, many have simply taken on more debt. And deregulation of the financial markets allowed for a shadow banking system that provided the heroin (debt). A ponzi scheme run by your local drug lord.
I agree with you. Prices can rise for two reasons: more money or greater demand for the same items.
Our system cannot distiguish between the two causes. Remember when oil prices were rising due to demand, and Greenspan wanted to end that inflationary rise? He did so by raising rates, and sending the economy into a tailspin.
Now, oil prices are rising not because of demand, but because of more dollars-inflationary dollars.
Real higher prices for items stimulates new businesses to get into the game and bring more suppy to the market.
Higher prices due to inflation does nothing of the sort.
prices can also rise due to supply declines in commodities faster than monetary base contraction as well as from erosion of the core moneyness of the debt we use as currency
Agree. Although I am seeing a pick up in the demand for oil. Not here in the USA, but in the emerging markets.
Inflation (per Webster):
"a continuing rise in the general price level usually attributed to an increase in the volume of money and credit relative to available goods and services"
That is the result not the cause. If people don't have the income to keep buying all the higher priced goods, the price collapses. Simple law of price and demand. Nothing is ever static.
"Only increases in wages can induce inflation." - lovejoy
That begs the questions:
1) are wages the ONLY source of (monetary) income?
2) How do you give weight to the different products and services that money can purchase in order to "measure" inflation? Obviously, by giving greater statistical weight to the prices of feathers and faux leather than to corn and beans, one may claim there is no "overall" inflation, though commoners may be unable to purchase food with their fixed wage income.
Why do we believe he is at all sincere in anything? I realize, he's not the best actor... but, at the same time, he's had plenty of time to get better at lying. All officials, whether public or pseudo public (fed) all use speech, releases, etc. to alter public perception... sometimes at the expense of credibility... sometimes to lose credibility... all noise and meant to implement confusion on our parts.
Im 100% sure Bernankes only ability is printing money.
Even that ability is suspect.
http://www.dailymail.co.uk/news/article-1336287/A-110billion-mistake-Pro...
100% sure?
Of Quantitative Interruptus?
Don't forget the Bernank's lie on monetization:
""We're not going to monetize the debt," Mr. Bernanke declared flatly"
http://www.washingtontimes.com/news/2010/feb/25/bernanke-delivers-warning-on-us-debt/
Lying by omission.
The Bernank said he could always control inflation by raising interest rates to 20% or 30%, if he wanted to. Which might be true in itself.
What he didn't mention is that for a plethora of reasons he will NEVER EVER want to do so, as long as anything less than a currency collapse happens. And if it will still work then is to be seen...
I don't think you all are giving Ben the credit for the power he wields. Yes, he ought to have 100% confidence that he can stop inflation IF HE WANTED TO. If inflation got out of had, there is absolutely nothing to stop him from raising interest rates to 50% or more overnight. Yes, the economy would instantly collapse, but so would inflation. The correct follow up question is, "Do you have the balls to actually do it?" He didn't have the balls to allow the risk takers on Wall Street to lose, so we can infer the answer to that question is, "No, I don't."
The fact he has to go on 60 minutes sorta proves he has a problem and ain't got a clue.
Shoulda went on "Gorgeous Tiny Chicken Machine Show":
http://www.youtube.com/watch?v=5usOxDNGZgs&feature=PlayList&p=g5qn6YOenVY
If you're gonna be comedian, do it right! :>D
50% of the time, he's right every time.
The Bernank eats shit.
Yeah, he's 100% wrong. Neither Volcker nor Greenspan "tightened" monetary policy by raising interest rates. Volcker targeted non-borrowed reserves & the result was that legal reserves skyrocketed @ 17% annual rate after the DIDMCA. Greenspan never "tightened" despite 17 rises in the FFR. It took Bernanke to "tighten" & he did so for 29 consecutive months, or at first, sufficient to wring inflation out of the economy, but persisting until the economy collapsed. I.e., Bernanke didn't initiate an easy money policy until Lehman Brothers filed for bankruptcy protection. And if you don't understand that you don't understand money & central banking.
So, we give up a stutt, stutt, stuttering Fed Chairman for a Twitching Fed Chairman. Body Language speaks volumes. Bernanke does not know what he is doing. I could not believe that he was asking CEO's what he should do. The same when he asked the Major Banks how much he should print.
Studying the Great Depression does not give you the skills to get the Country out of the 2nd Great Depression. He has no clue.
When you're up to your ass in alligators, it's kinda hard to remember that the original objective was to drain the swamp! The Bernank is like a deer caught in the headlights.
TD, it was a pathetic display, with no real substance excpet confirmation of idiousy.
is poor spelling also a sign of idiosy?
I saw it...the Bernanke's voice was shaking and his lip was quivering throughout the entire interview. Anyone else catch that?
Yeah he used to do that a lot when he first became fed chairman ... like the pimple faced kid in the krusty burger store in the simpsons "i'll have to ask my supervisor"
....more like someone who's wound tighter than a two day clock. Seriously, those tremors make him look like a man besieged from all fronts and on the verge of a breakdown.
I think he's scared because he's a liar and is worried he will be exposed. Actually, he should be a lot more scared, because when the dollar implodes, Bernanke will be vilified. Or rather his memory will be, because he will have been silenced (sorry, "committed suicide").
Bernanke's 'tell' is his left eye. It winks everytime he lies. When he said "100%", I thought it was going to roll out across the floor.
Eat your heart out Pinocchio.
Watch it again.
The source of all their power is you. You are trained from birth to worship their ideals, to honor their values and to follow their laws. And for what, so you can labor as slaves, working harder and longer and sacrificing everything which once held meaning in your life so you can earn their precious prestige? How many days will you toil this year only to feed them? Will it be August or September before one damn dime makes its way to your family? The average "American" will work 2,496 hours this year yet less than 1,000 of those hours will they keep while nearly 1,500 hours goes to feed this despotic parasite system of permanent bondage. You are a slave. A voluntary slave. You are a bee in the hive which exists to produce for the queen. Put an end to their control over you. Throw off their yoke. Stop their motor and you will put an end to their power. Leave the hive.
I bet Bernanke does not pump his own gas, buy his own groceries or pay his own bills.
If he did, he would already know he is 100% wrong.
double post
They should average out these percentage increases (37.5%) and deduct them from Bernankes salary so he is actually personally effected in a negative way from his God complex like pretty much everyone else.
There are 2 major problems I got with Ben Bernanke.
The first big problem is with Ben's CPI figures and the Inflation figures.
Why does Fat Bernanke exclude Energy and Food from the CPI Consumer Price Index figures ?
Everyones Food and Energy costs have gone up like crazy,so why are these fat fools insiting to constantly disregard the price and cost of Food and Energy ? Bloody Fools !
Bernanke is either living somewhere on Uranus or gets free Food Stamps from the salvation Army or all of the above.My cost of Living and bills have gone through the roof !
When was the last time Bernanke went shopping for basic Foods, like Bread,Milk, Apples or Bananas ? When was the last time Ben looked at his electricity bill or filled up the Tank ?
Bernanke acts like a spoiled little brat who never had to do anything like that, he has no Idea of CPI or the real cost of living!
The second problem is that Idiot Brian Sack experimenting at the FED Desk buying Treasuries to bring Treasuries down.Now that is an Idea 3 fools came up with in 2004 and it had never been tested.So we got these Fed fools experimenting with the world economy and we all know what happened since 2004,so if these guys concocted this stuff up before the shit hit the fan,then they were part of the problem,with no Idea or any solution!
Who Is Brian Sack?
In 2004, two prominent Federal Reserve officials, and one little known economist, wrote an intriguing paper which presented evidence that the central bank should buy Treasury bonds to drive down long-term interest rates if the economy ever ran off the rails. The two officials were Ben Bernanke, then a Fed governor, and Vincent Reinhart, then the head of the Fed’s powerful monetary affairs group. The little known economist was Brian Sack, a rising star who had just completed a stint as a staff researcher at the Fed
and was soon to help fuck up the world economy all the way up Bernanke's Uranus !
This man is more of a threat to our country than Julian Assange ever could be.
Couldn't ask for better character than what 'The Bernank' has become.
Never did I think I would live to see the day of regular propaganda in America. Now, I see it in the MSM every single day! This is only the latest example!
@prophet of wise: I tend to agree with that, but most are sleeping slaves, rather than voluntary (though staying asleep is a choice too). Anyone who has had the sense/morality to turn their "money" into gold/silver is throwing off the yoke.
Do you honestly believe that Bnanke does not know what is happening and that he is clueless??? Keep dreaming... He is simply acting as he is supposed to: as a puppet!
It is his job to say this crap and then come out of it looking dumb and ignorant but with a huge GS contract!! It is all a scam..
Buy gold, buy silver and hope for the "best"
the Bernank knows he lives in a confidence and faith-driven world. So when he says 100% he is just trying to project leadership and confidence like Bama does or Busch did.
It's like when your girl says "promise me everything will be ok." I always have trouble with this because my natural logical response is, "honey, there is a significant likelihood that everything will most certainly NOT be mfin ok," when all they want to hear is the pleasant lie.
The Bernank is giving the pleasant lie to a bunch of women.
I am 100% sure that i shit my pants while watching Mr. Ben Bernak quiver while talking.
And here is my first attempt at the bears. Please let me know what you think.
http://www.xtranormal.com/watch/7958245/#
I'm 100% certain Ben was lying, and knew it, when he stated emphatically that the Feds actions were not increasing the money supply.
In my life I have been 100% certain of only one thing. The first itme I jerked off I was 100% certain I'd do it again !
the bernank's printing press broke - recall QE, we're saved. <sarcasm off>
http://news.yahoo.com/s/yblog_thelookout/20101206/us_yblog_thelookout/go...
Although the premise for QE2 to add to the equity wealth effect is valid to some extent, I think QE2 is in place to fund government. Ben is just filling in demand for US sovereign debt.
However, the historical notion he uses that QE2 is to control rates in terms of prior smaller imbalances is not correct. His goal now is to manipulate rates, that is, control the buy to the point of setting price regardless of auction participation. QE could reach a point where the FED transacts 65% of issuance, with the remainder purchased as an offset for trade.
This makes sense to me as a vehicle to support large future deficits. So is Ben really positioning for ARRA2? Perhaps the last Keynesian gasp.
The real lie though from Ben is that he has the tools to unwind (tighten), being now the majority holder of US sovereign debt. This is obviously uncharted territory. Made worse by the fact fiscal and monetary policy must work together in order to reconcile our debts, and they are clearly bipolar.
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I would like to ask everyone on ZH, what is meant by;
"Economy is not self sustaining"?
What does this mean? We are at the point where the economy is close to not self sustaining?
To me this is an admission that the tax base (including any projections of real growth) can no longer support our debts (Federal and State). FED only growth is not only not self sustaining, it is now a potential trigger for a currency crisis.
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Real estate bubble correction is not compatible with Ben's notion of contiued price inflation. He will not acknowledge the price bubble or its correction, why?
Deflation in this sector may be as great as another 20%, which is significant.
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Currency in circulation is not monetary inflation, Ben knows this.
Bernanke bounces back and forth between monetary inflation and price inflation depending on the question that is asked. He never points out the difference or the importance of this difference. He is not honest with his remarks. He stays within the margins in order to safe guard the existance of the FED, and by extension, his professional existance.
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Why does Ben relate growth (GDP) to his control of price inflation?
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Ben also talks like of a lot of politicians, or perhaps the politicians talk like Ben, but all seem to think that the currency can be pushed to the point where all income goes to pay interest and entitlements. This is clearly not possible. The system will break before this happens.
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What was not said or asked:
Well it is clear that Scott Pelley, in his very probing voice, did not probe. It was as if he was given a question sheet for things that were permissible. Ben refused to answer political related questions, but that is normal FED policy anyway.
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It is interesting that we have remarks that proclaim that the FED should not be politicised. By this I guess they mean the inabilities of the political class to chart a sustainable course. But, congress should really have the powers the FED now wields.
How does the nation recover when even the FED believes that are political system, our congress, is ill prepared to govern.
Mark Beck
60 minutes only scorches those they disagree with.
With corporate controlled media there is no "real" journalism, just appeasers to the ruling powers.
"Behind every great fortune lies a great crime."
Honore de Balzac (1799-1850)
"This [Federal Reserve Act] establishes the most gigantic trust on earth. When the President [Wilson} signs this bill, the invisible government of the monetary power will be legalized....the worst legislative crime of the ages is perpetrated by this banking and currency bill."
-- Charles A. Lindbergh, Sr. , 1913
"From now on, depressions will be scientifically created."
-- Congressman Charles A. Lindbergh Sr. , 1913)
"The real menace of our Republic is the invisible government which like a giant octopus sprawls its slimy legs over our cities, states and nation. At the head is a small group of banking houses generally referred to as 'international bankers.'
This little coterie...run our government for their own selfish ends. It operates under cover of a self-created screen...[and] seizes...our executive officers... legislative bodies... schools...courts... newspapers and every agency created for the public protection."
John Francis Hylan (1868–1936)
Mayor of New York City (1918—1925)
"The financial system has been turned over to the Federal Reserve Board. That Board administers the finance system by authority of a purely profiteering group. The system is Private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people's money"
-- Charles A. Lindbergh Sr., 1923
You have to choose between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the government.
And, with due respect to these gentlemen, I advise you, as long as the capitalist system lasts, to vote for gold.
George Bernard Shaw (1856–1950)
"Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States"
-- Sen. Barry Goldwater (Arizona) (1909-1998)
Raise rates in 15 minutes? Does someone need to remind the Bernank about the term structure of the U.S. Treasury?
LOL! Good point. Nothing seems to phaze The Bernank, however. I am not sure where his 100% confidence comes from, but I am pretty sure it does not come from his understanding of the big financial picture around him and this nation.
The man who has been wrong 100% of the time, now claims he is 100% certain he is right.
I am 100% certain Bernanke is 100% bought and paid for by those who hold his leash... the international gansters bankster predators and their co-conspirator predators in fiat governments worldwide.
governments == fiat, fake, fraud, fiction, fantasy.
central banks == fiat, fake, fraud, fiction, fantasy.
Wake up humans! The predators are running wild.