This page has been archived and commenting is disabled.
It’s the ‘Bernank’ that done it!
Bernanke has made himself (and thereby the entire Federal Reserve) the lightening rod for domestic and international inflation. What a dumb PR move that was. There are any number speeches by Ben and his cohorts where they stuck there neck out and said, “inflation is our goal”. Ben & Co. are going to eat those words. If you ask ten people if INFLATION is ‘good’ or ‘bad’ nine of them would say it's BAD. It is the way we grew up. Ben is doing something bad.
A very small percentage of the population actually understands what the
Fed is doing. Far more people have watched the YouTube cartoon
explanation of QE than have listened to/read Bernanke. But a great
number are aware that the Fed is engineering some inflation. So when
they get hit in the head with some big price increase the first thing
they are going to say is, “It’s the ‘Bernank’ that done it!”
Consider me as a case in point. I already pay a ridiculous $1,629 a
month for health insurance. But today I get this nice letter from United Health telling me that the good folks at the NY State Insurance Commission have approved a 12.5% increase for just the next six months. I am looking at a 25% YoY increase in healthcare cost.
That NY State is granting 25% rate increases is a crime in my opinion.
That Obama Care created a three-year window of maximum gouge
opportunities for the likes of UNH is also a crime. The problems with
health care and the cost of insurance can’t really be blamed on Ben and
the Fed. But I suspect that many folks are going to blame him anyway.
After all, he’s the one who wants inflation, so when we get it, the
fingers of blame are going to be pointed in his direction.
There are millions of Americans who are getting letters like this. You will see stories in the MSM in the next week or so. "Insurance Companies Gouge Customers"
is a good Thanksgiving story. It’s even possible that the crooks in
Albany will be called on the carpet for allowing such an egregious
increase in a basic cost of living. The boys at UNH will defend what
they have done and just blame the increase on INFLATION in the cost of
health care at every level.
I (begrudgingly) accept that Bernanke and the rest of the merry folks at
the Fed don’t really want inflation that just eats up consumers. They
want to see inflation from the demand side as evidence that the economy
is in fact growing. But it is not going to go down like that.
Over the next few months we will see a number of big jumps in basic
costs. Food, health care, insurance, transportation, gas and electric
are all going up in price. We may not see the evidence so clearly in the
headline numbers. My 25% increase in health care will not show up. That
does not matter. Tens of millions of people will feel this pinch. There
will be no blaming of OPEC, or China this time. The blame is going to
be placed squarely on the shoulders of Bernanke and his vocal enthusiasm
for ‘the’ inflation.
I will tell you that I was damn mad to see my annualized insurance bill
go up by 25%. A lot of others will soon feel the same when they get a
similar letter. Or when they look at their next electric bill, the cost
of vegetables or even the price of a pair of jeans. A good number will
say in anger, “It’s the ‘Bernank’ that done it”.
Bernanke has tied his success to a rise in inflation. America is going to absolutely hate that.
Even greater public distrust of the Fed will inevitably follow.
Politicians will jump on the bandwagon (they always do). The end result
will be that QE will be a disgraced policy and the Fed will be weakened
for a long time. Ben will get his inflation, he is also going to lose
his job.
»
- advertisements -
Bruce, might I suggest an alternative to 24K, getting a part time job at Ikea or other employers that provide health insurers to part timers. At least as of two years ago, when a friend worked at Ikea, they provided health benefits with a solid mainstream health insurer for fulltime workers at $8/week, and 32 hours a week was consider fulltime, if you worked part time, anything over 8 hours a week, you could get same package for slightly higher employee contribution, I think is was about twice the cost of full-time package so about $50/month, which basically her wages for the one day of work a week paid for. So you can get 24k annual benefit, tax free, for about 400 hours a year...that's like $55/hr, tax free, so, depending on yoru tax bracket, like 470/hr taxable wages. This may not be worth it for you, but for most people that are not making anywhere near $70/hr, its a great deal.
My friend was freelancing as a graphic designed and need health insurance. When she had disparate gigs with many companies, she got a job working 4-5 days a week from 5 am to 9 am loading the shelves at Ikea with product for min wage and health benefits, and then did her free-lancing work the rest of the day. When she got a steady gig working 40+ on site at a big corporation, she went down to the min needed to get benefits, the 8 hourse a week, which meant going in at 5 am every Sat morning and working her arse off, but well worth it to the bottom line.
Most of the people she worked with at Ikea were either poor working class people or spouses of someone that had a good paying job/business but no insurance so their entire Ikea job was to earn benes for the family. The working class people, they worked at Ikea for the bene's and they all had a second jobs that had often had 32-40 hours/week and paid a bit more but didn't provide benes, but they need more money and bener's, so they tacked on the Ikea gig. Most of those people cobbled two jobs together to work about 65-80 hours to make enough to live and have benefits. One of the people she worked with was a fired Northwest Airline mechanic (they went on strike and lost). She went back recently and said there had been little turnover, everyone was still there stocking shelves, although some that only worked at Ikea had managed to move up to supervisor positions.
Thanks for sharing that info.
After the increase you'll be looking at 24,435 a year-UG.
How many in your family is that covering?
It is a painful eye opener.
Failed foundations and blame on any brick are not the fix.
We have to get the foundation fixed,after that we can dissect the rotten bricks.
That 24G just covers me. There is no other beneficiary. Talk about an eye opener....
Don't Worry About Health Care Costs, Bruce
Obummer's "Screw Amerika Corporate Insurance Welfare No Reform" reform plan is on the horizon to save your day...
Just hit the <RICO> button to insure your savings...
Bennie Bernank-ster: Just Following Orders
Bennie is just a hired front man following the orders of the Fed shareholders... Let's see, at the FRBNY it is JPM, Citi, NY Bank, Goldman Sachs, Bank of England... Follow their orders Bennie Boy...
Just hit the <RICO> button to insure the Fed is following its mandate and protecting you from inflation...
Bruce,
Your health-care premiums are the average price of pool maintenance in Carefree, AZ -- over $2k a month.
What you fail to address is the racketeering by health corporations against the truly "priceless" life condition. How would you put a price on life, up or down? Now, create an insurance racket to drive that model - ALWAYS UP -- ALWAYS, ALWAYS!
Give me a break -- Nothing but ever-more corporate oppression using your health as leverage and a bonus. USA INC while the people rot.
Paying $1630 per month for health insurance is just stupid. Save the money yourself and pay cash for your treatments abroad. $20,000 gets you a heart transplant in Europe.
Hey Bruce good piece .I think Bernanke is going about it all wrong and is doomed to failure . First of all QE2 should be done as a jubilee type effort by the FED (I dont beleive they should do anything but if I was on the other side of the fence this is how I would do it . First , create "negative interest rates " for banks where if a bank loans at 0% to a person/business he makes his money from the fed (the fed pays the interest to the bank(say 6% for an example) in a lump sum for compounded interest it gets right then and there as soon as the loan originates),the business profits if it buys equipment because inflation will once again "reboot" as many will see the benefits of getting a 0% loan . They will also refinance existing loans to the new rate freeing up cash flow . Hiring would commence . Consumers would also jump in the refinance pool ,freeing up cash flow as well for them to get in trouble later . I also believe housing would pick up again as a result as anyone with half a brain would buy a house on zero interest for 30 years . Inflation would definitely result from a policy like this ,it would still bail out banks at the same time but money would also get into peoples hands who could do something with it .
My employer had huge, 15-25 percent increase in health care costs 3 and 4 years ago, it was a big crisis for us...shoot one year, we almost couldn't find someone to cover our small business because of one guy in the company that had a very sick kid, cancer, had a very expensive but effective treament. While all this was happening, we really had no one to blame, we were jsut upset and concerned about health care costs. But this year when lesser increases to our health insurance price happened, Obamacare was blamed.
Was the Bernank or Obama responsible for $140 oil? Who was?
My point is how different people's reactions are to things when they think they have someone to blame. And it confirms your point Bruce.
I always thought the American population would be in revolution if the price of gas was $4.00, but that didn't happen in early 2008. That price whapped our economy and good, people complained and moaned, but there were no pitchforks, no politicians threatened with death.
Oil went from $20/barrel to $140/barrel from 2002 to 2008, a pretty damn short time period for such a change. It wreaked havoc on our economic systems because suddenly shipping distances, methods and manufacturing methods that worked with cheap oil did not work with at $100/barrel. It ate into Americans everyday pocket book big time.
Despite all this quickly increasing costs, there was no one specifically in the American physche to blame for the high price of gas. It was due to world growth, demand in China. I heard a few smarties get mad about "investor" speculation in basic commodities markets and lack of transparency, I heard T Boone Pickens complain about the wealth transfer,,,but where was our oil money going? Saudis? Norway? UK? Venzuela? AK, LA or ND?...,
Despite the horrible pain of high price oil, especially the disrupton of the quickly upped price of oil, people took it with little agitation. I think, because they specifically didn't have any one to blame. There were more people in world wanting oil and the price just went up, maybe oil is peaking, so oh well, sell the truck, move out of exurb.
But if they somehow they had thought Obama, or Congress, or the Bernanke had something to do with oil going from $20 to $140 a barrel, there would have been a revolution.
All very true, including this latest comment, but except the implied presumption that Ben does or should give a damn what the population think of him. He's no candidate for president, and he might not even want to get re-appointed. Absolute worst case scenario he's pressured to resign, and even then they welcome him back to Princeton with open arms. Bernanke is doing a huge favor to the Democrats, by taking much of the blame for inflation. No wonder they like him so much.
Health care costs are going to just keep getting uglier. Obama's claims to have reined in Medicare cost increases are going to crumble to dust by next year already. To some extent it's the waste and corruption inherent in publicly funded, privately provided service, but that has always been there. To some extent it's an unavoidable result of medical progress and the high value we place on human life - what are we going to do, not provide all those increasingly expensive life-prolonging equipment and procedures that medical science keeps coming up with? To some extent it's genuine inflation, driven by growing demand for medical personnel, driven by the aging demographic.
By the way, if you look at GDP and job growth figures, around a third of the total reported GDP since last year has been in health care. And remember that when statisticians aren't sure if price increases are due to inflation or quality increase, as that's almost impossible to sort out in complex sectors like health care, they generally assume it's quality increase and mark it down as real GDP growth.
IMPORTANT OBSERVATION
Follows are 180 or so comments. As you look through them note those that remarked that they too received a notice of a big increase in the past few weeks. It is not just NY. It is not just my crooked Ins. co. UNH. It appears to be across many states and covers many different providers.
My point: These notices were all sent out AFTER the last election. The State Insurance Commissioners across the country gave the increases to the big corporate insurers but kept it quite until after 11/3.
My conclusion: We have been had. Nothing new. But it is tough to take.
bk
These are dark times, Bruce. Let's stick together and raise our voices as we are doing.
Love and right wins every time. It may take a while and they will go out kicking and screaming but their days are numbered.
"Ben will get his inflation, he is also going to lose his job."
I can only hope you get this call right.
If the world wants to get out of this crisis, the first and vital step that has to happen is this guy has to lose this job.
As long as this cretin is the Fed Chief, nothing good will happen ...
We in India celebrate good things with crackers, so I am keeping some of the stuff so as to be able to celebrate as soon as your call turns right!!
Good call on this one Bruce.
I'm not surprised that state entities are upping fees given that so many see themselves as insolvent. These rises aren't a consequence of bad Fed monetary policy, they're a consequence of bad fiscal policy and don't deserve to be lumped as "inflation" on the Fed.
With misinformative viral videos like "Quantitative Easing Explained" (but actually not), people *will* blame the Fed.
Group $2,800/month, $5,000 deductible, 6Mo6Mo +19%, (uninsurable)
It's so absurd. Because if all you "uninsurables" would get together in a group, you could create a pool. But...lemme guess. There's laws against that.
But of course...
And if there isn't, there is included in the legalese an option to make a law, since no one can decipher the law anymore, and we all are ignorant of ALL of the law, therefore, we are all guilty, as ignorance of the law is no excuse. That's why they write it up the way they do. If its not explicitely permitted...
In my state I just checked the risk pool premium for a 60 year old non-smoking male living in the large cities......... $1699 for $1000 deductible, $940 per month for $5000 deductible. So, Bruce your premium in NY is similar to the risk pool in Texas. This quote is in effect since August 2010.... could increase in January. Yes, people who work for the state have no concept of what's going on out here.
$1,629 a MONTH??? None of my business but what am I missing here? I whine about paying @168./mo. Must be a family charge? No wonder people are frothing at the bit about O'B-Care.
You got it. 1629 a month. No family here. Just me.
Many of the affluent diseases we suffer from stems from the food we eat. Read 'the China study' most of the modern diseases we have are from eating too much animal products, like dairy and meat. Instead, eat a plant based diet.
The doctors, medical schools, professors, dairy farmers, egg farmers, etc., have a vested interest in you eating this unhealthy food. When you get sick, that's money in the doctors and drug companies pocket. Why is it that they want you to be healthy again? You know, those sports cars don't pay for themselves.
The solution to health care is not more surgeries and technology. The solution can be found at the end of your fork.
Bullshit.
I will agree that "The solution to health care is not more surgeries and technology. The solution can be found at the end of your fork."
The issue is WHERE does your food come from?
I eat a "Caveman Diet"...works for me, natural animal proteins, raw veggies (lots of them), raw fruits, and a few grains here and there.
For some people, you are correct, they will be helped by a vegetarian diet, for others , not so much. I was a vegetarian for years and let it go, once I figured out that my particular body type was best served by an "as natural as possible" diet, including raw meat, veggies, nuts and fruit, grown in the most natural way possible. And no grains as a rule, broken easily.
That's what works for me, my wife, on the other hand, does best on grains, veggies, fruit and no meat/dairy...43 and 115 lbs, 5'4" MILF...not just my opinion, but that of overhearing the son's friends talk.
So, one diet remedy....bullshit.
Maybe that's the problem, we keep trying to find a "one size fits all" solution, which doesn't exist.
Take back control of your health, a solid path will take about a year.
www.uniquehealing.com
Many of the affluent diseases we suffer from stems from the food we eat. Read 'the Chinese study' most of the modern diseases we have are from eating too much animal products, like dairy and meat. Instead, eat a plant based diet.
I agree that many of the affluent diseases are caused by diet, but I think the main culprit is sugar, with starchy tubers and polished grains (white rice, white flour) a close second. Meat, fish and eggs are very healthy foods for people.
A plant-based diet might be OK if it doesn't involve too much starch. You would have to eat a fair amount of high-protein veggies (beans and such).
--Mamba-mamba
"A very small percentage of the population actually understands what the Fed is doing."
Bruce, since the Fed is running an experiment based on a hypotheses, do you believe that the Fed understands what the outcome(s) will be?
My health care bill also got hiked 20% (Illinois). I am just pounding my head against the wall. When I called BC&BS, one representative stone-walled me, only said it was approved by the state, while the other said it wasn't their fault. All providers just jack up their prices.
Why do people choose to live in delusion?
damn it, people ! i'm getting sick of this ! so, on DECEMBER 7 we are all going to withdraw our money in solidarity with FRANCE (that soceer guy told us to ) .........then, why the hell don't we all just cancel our health care insurances on DECEMBER 8 ?! I DON'T EVEN GO TO THE DAMN DOCTORS ! ........ it's a racket, a scam, a money-pitt & a control mechanism ! I WANT OFF THE GRID !
I hear you. I don't go to the damn doctor either but pay each month like a truly brainwashed member of the common masses. And what's worse is- health insurance is not the big soft safety pillow we're led to believe. A friend of mine with supposedly great coverage got diagnosed with cancer a year ago and is now filing bankruptcy because of what his "insurance" will not pay. Worked like a dog his entire life to build a ranch and now it belongs to Aetna. Sux.
I already did all that. I don't have any health insurance and I'm preparing for a $10,000 surgery. I have been shopping and doctors are actually interested in the cash. I'm 50 now and a fifty year old woman's insurance premiums are more than my house payment..... so, it just had to go. If I would go to work with government it would all be taken care of but I'm from a long line of entrepreneurs who believe that government = corruption. I spent 90 days at the EPA in the 80's and was truly convinced of that. I will probably die of a heart attack worrying about not having insurance.
I was never impressed with Greenspan and his goofy English language aerobatics, Bernank advertised himself as being the ONLY one on the planet that understood the great depression. Bullshit. Whenever someone claims to be the ONLY one with the ability to do a job I know it is a crock of BS. That was a real dumb move by Obama to keep The Bernank. This is a groundbreaking article from now forward he is The Bernank.
from now forward he is The Bernank.
That's what two of my office mates and I blurted out loud the second we heard that off the cartoon. And the Greenspank was no prize, either.
The Bernanke wants the "good inflation" of houses and markets (assets) not the "bad inflation" that affects the consumer. Just print the numbers you want and lie about the rest. The cost of tar, feathers, torches, and pitchforks are surely going up.
We need to understand that Ben, for the Fed, and Obama, for the Presidency, and so on and so forth, soon to include the orange-skinned Boehner, float reasons for doing what they are doing that have nothing to do with the real reason since they understand that most people are not very bright or inquisitive, and thus gullible to false reasoning, , and they really can't say the real reason because it would upset the generally prevailing illusions (and thus dangerous, mostly to their own positions of power, since TPTB would replace them with someone who "goes with the flow".) Now, if they find a reason that "catches" and works for them, they can ride it for a while while they continue to do what they were going to do anyway. It is part of the human condition in this milieu. It's all lies, 24/7.
Ben is just following the playbook. "We're just misunderstood" is the latest in a series of proferred justifications for QE2, and its inevitable progeny. It wasn't long ago we were "injecting money into the economy - like basting a turkey - to help the employment situation." What we need to truly appreciate what is going on when Ben speaks is a Brady Bunch era laugh track to go along. That would be perfect.
Know anybody good with video editing, put it on YouTube. A million hits, guaranteed!
I think it would be a scream. The script would look something like this:
Grayson: So, where did the half-Trillion dollars go, Mr. Chairman?
<Ha-haahhhhhaa>
<Numb silence. Cackles from audience.>
Ben: Well, I don't know, exactly. Europe, I think.
<Hilarious laughter>
Ben: I'll get some people on that right away.
<Ha-hahhahahhaaaaaahhahaaaa>
SELAH AND AMEN
UNH is ripping everyone off. They sold my union (UFCW) some "prescriptionsolutions" card. I pay COBRA (laid off) and the union plan cost for my 90-day lisinopril 10mg(generic) is $14.00. I checked the online UNH prescriptionsolutions.com, the price is FIFTY FIVE DOLLARS! Now, I don't know if they are moving to this soon.
Also, note that Humana now wants to start buying up "primary care facilities" CAN YOU SPELL MONOPOLY? Not a peep from media on that? They're raking it in for acquisitions now!
Revolution needs to come soon.
Don't forget to factor the two-tier wage systems into the coming American export boom when China revalues it's currency.
http://www.nytimes.com/2010/11/20/business/20wages.html?_r=1&hp
http://www.jsonline.com/business/104284268.html
I'm sure the new American middle-class will be praising "The Bernanke" for their chance at the American dream of their grandparents -- those actually able to find work in the 1930's.
Counterfeiting is a serious criminal offence but Bernanke is still at liberty.
I'm a healthcare provider. The rate of reimbursement I receive from this insurance company and other insurance companies has not and is not going up. So where is this money going?
In their pockets or the politicians pockets. Take your pick.
Look upon it as the "Insurer paper-shuffler/Govt overseer full-employment" act. :(
Bonuses and future pay-offs when healthcare gets nationalized in a few years. Part of the plan.
Sanctioned front running of the coming crack down. Giving the biggest companies the wherewithal to buy up the smaller competition.
Yup, even in the NYT...http://www.nytimes.com/2010/11/21/health/policy/21health.html?src=mv
Unfortunately (and I view this as a creative opportunity wasted, I expected so much more...lol </sarcasm off>), it is right there in the bill, in obtuse, verbal diarrhea legalese, that the insurance companies have "X" years to get while they can.
2013 Problem: mandated health care is too expensive for the sheep
2013 Problem: mandated health care is too expensive for the small businesses to subsidize
2013-14 Solution: mandated health care is nationalized, former health insurance companies paid off vast retirement benefits to go quietly, in addition to what they have taken in the 25-50% rate increases over the last few years.
It is right there in the bill, now that it is passed and we can be permitted to read it.
Ok, dark/sardonic mood tonight for me.
I read the bill, called my sister the lawyer to decode parts of it, as a natural/alternative health person and small business person, I can find nothing good in this health INSURANCE reform (as opposed to health CARE reform).
My bill for Cigna went up 17% this year.
I think it's time to eliminate the health insurance industry. Go to fiat payment system.
Your lucky...mine went up 28.5%, and I heard others were worst.
Union members love the new mandated coverages for their 26 year kids(when is a 26 year old man a kid?). So who gives a s____ if someone else pays as long as I don't have to pay.
Most revolutions start when people are hungry. Most of the higher cost of food is going to hit the poorest in undeveloped countries. Uncle Ben will cause untold hardship and starvation for billions. What a s___head.
Um...Bruce, Insurance Cos aren't raising your rates as a result of anything that the Fed has done. If you thought this was bad, wait till the effects of Obamacare start to set in.
All those people who can't afford insurance are going to be forced to pay and all those who can pay are going to be expected to pay MORE. There was no attempt whatsoever made for cost controls...we are self-delusional enough to believe that because we are America and therefore #1 at bestness, and super rich and all that shit, that we can afford gold-plated care for EVERYONE.
No sooner would someone say that the poor need to lower their disgusting obesity rates than someone else would bleat that this is a "free" country. Those of us who do pay are now going to pay insurance companies to pick up the tab for the type 2 diabetes of indigents, atop the Medicaid we already pitched in for.
Anyone see Bill Gross' comments on QE2?
"The Fed wants to buy, so come on, Ben Bernanke, show us your best and perhaps last moves on Wednesday next. You are doing what you have to do, and it may or may not work. But either way it will likely signify the end of a great 30-year bull market in bonds and the necessity for bond managers and, yes, equity managers to adjust to a new environment."
Spicy! Especially the gruff-old-gunslinger line, "so come on, Ben Bernanke, show us your best and perhaps last moves".
Mr. Gross dropped this on'em too: "Check writing in the trillions is not a bondholder’s friend; it is in fact inflationary, and, if truth be told, somewhat of a Ponzi scheme. Public debt, actually, has always had a Ponzi-like characteristic. "
http://www.pimco.com/Pages/RunTurkeyRun.aspx
If they would drop moneybombs everywhere it is bad.
But they are dropping moneybombs with laserguided presision
right in to the pockets of the bankers,this is even worse than
weimar,this is more Zimbawe stile.Whole wold is turning into
one woldgouvermentbananarepublic.
& just how do "they" think we're going to save any $$$$ for our retirement ! ........... looks like I'm going to cancel the cable for real now. funny, there was NO HEALTH CARE CRISIS 10 YEARS AGO !!!! IN FACT, I REMEMBER GOING TO THE DOCTOR'S OFFICE IN 1976 & PAYING JUST $8 FOR AN OFFICE VISIT !!! ......... & in 1968 when my sister had a baby, the TOTAL DOCTOR'S BILL FOR ALL THE PRENATAL CARE WAS JUST $368 !! (she still has the bill) . I don't go to the damn doctor but once every 10 years anyway, if I need healthcare, I'll just save up my own $$$$ & pay cash.