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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.
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"All I can say is, "I told you..." but that's not my style."
Then just give them that "I told you so" look. When public memory fades away again 80 years from now, the whole mess will happen again... assuming the human race isn't set back a few hundred years by the Global Thermonuclear War of 2015... (the Incas didn't know squat). ;-)
We're skewered, well-done, and halfway to being eaten by these conglomerates. We see it, others don't, and I pity them when the day comes that basic social services can no longer operate, and we're tossed into the wind like so much garbage.
"we're god's unwanted children, so be it!" -durden
but what if the wind gave you a choice of where you wished to be discarded?
would you wish to be thrown in the landfill with all the plastic petrol products and spend the next 5000 years helping them decompose or would you wish to be thrown in the compost pile so that you could fertilize next season's harvest?
Food inflation, which will hit people where it hurts--in the gut, could in fact be made worse if we get another round of this--
http://johannhari.com/2010/07/02/how-goldman-sachs-gambling-on-starving-...
Say it can't or won't happen here? They wouldn't dare?
Read that article agin. They rolled their profits from the MBS scam into starving the worlds poor for profit.
Consumer price inflation in the U.S. would give them the perfect cover to do it again.
1. Put your assets into an Irrecovable Trust.
1a. Get to know a doctor, if you don't already, who will take cash for routine treatment and Rx refill services
2. Cancel your health insurance.
3. Screw the system.
The Banks need to devalue your currency to siphon the juice into diminishing the value of their worth zero Helocs on underwater real estate (the Florida Swampland of the 1920's). Housing, Education, and Healthcare have gone up 10x in the face of relentless improvements in technique and delivery, yet the opportunity to afford thesse essentials to good citzens has gone the opposite way. The consumer culture has now eaten through two generations and threatens two more, the elders and still unborn. The Federal Reserve Act of 1913 has managed a fraud-based economy and only righteous Tim G. and the Bernank are left to defend it alone. The whole world is watching and "take a semester off" to intern at the job of your passion will be the new educational model. A year at Harvard on DVD costs 4,771.50 rather than 47,715 to deliver.
That article is filled to the brim with fallacies. Anybody who believes that "speculation" was responsible for rising food prices (or energy prices for that matter) is a total idiot.
Agreed, the left is extremely desperate and for some reason has lots of little robots trying to make comments on ZH thinking idiots will read it and believe their bullshit so they can have their socialist revolution where they will drive out the speculators. Probably Chavez and Chomsky fans, etc.
To the contrary, there is plenty of evidence that price spikes in ag commodities a couple of years ago, which triggered food riots around the world, were caused by speculation in those markets.
So you are unaware of the immense influence speculators have on commodity prices? It has been said that the futures market dominates commodity prices. Have you heard of a little thing called silver? Is anyone who believes that solver is manipulated an idiot?
Piss-ant.
The urine-bug just knows that futures market speculations have zilch to do with price fluctuations? So, $WTIC went from $70 to $147 to $35 in the space of a year, totally on the basis of supply vs. demand?
The main players were Goldman Sachs and Vitol, and the crime was committed primarily on I.C.E and the Dubai Mercantile Exchange to avoid SEC oversight.
Google it.
Are you claiming there are shortages that indicate a supply shock?
Have people started consuming 40% more food than last year causing demand-pull inflation?
Or is it the Comex speculators and Wall St and you're just not all that bright?
No, it is not speculators. It is global demand and global supply.
Nope. Sorry. Food is abundant.
if there's a "food crisis" it will show up "where the demand is" first: East Asia.
Oh pshaw. Betcha he just meant that with the initial margin increases on the COMEX, it costs more to open a position so that drives prices up because it costs more.
(post hoc ergo propter hoc)
Nothin' to do with inflation. Independent variables. Like Russell's Paradox, solution is the null set