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Michael Pento's Mea Culpa
By Michael Pento
Apparently I was wrong. You have to be a complete lunatic to embrace
a gold standard or even suggesting our central bank behaves as if we
were on one. After debating with Mr. Mark Vitner of Wachovia on CNBC
this morning, I now realize that the Fed has done a wonderful job all
along. They have prevented all recessions, defended our currency and
have prevented all asset bubbles from occurring.
It was perfectly justified to have Pets.com trade at 15 million
times the eyeballs that clicked on their web site. Who needs earnings
when you are part of the new internet phenomenon? It was also fine to
flip a condo 5 times before it was even built. After all, shouldn't a
house that slowly disintegrates into the soil appreciate at 4 times the
rate of inflation?
We need more asset bubbles, a lower dollar, less savings and more
consumption. We need to print more money and let the Chinese worry
about producing stuff. Our money is prettier and now comes in new and
exciting colors. And as long as foreigners buy our Treasuries, who
cares about how large the debt grows.
I just feel better knowing the Fed is there to bail out rich folks,
bankers and those in debt. We need a flexible currency that can slowly
wipeout the middle class and those dumb enough to save money. I say
long live Banana Ben!
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I thought his performance this AM was brilliant. And hopefully his viewpoint will not be treated with utter disdain by those that actually believe central banks serve a real purpose. This sarcastic mea culpa just adds credence to his point of view...keep it up, Pento.
Either there's a crack in the driveway, or the Chinese are making their move.
This is The Fed.
The Fed is your friend.
You like The Fed, don't you?
If not, you are sick.
Tell The Fed.
The Fed will help you.
Very thoughtful. But wouldn't the system you describe be inherently hyperactive at building constructing investing and expanding. It sounds kind of like we aren't the problem any more. We just need a more destructive world to adapt to our hyperactive ways. Let's all move to the jupiter Moon IO which in rotating around the gas giant gets crushed by it's gravity and experiences constant liquifying and solidification. It's very violent atmosphere perfectly adopted to our economic model. Or else we can just overbuild overdevelop and over expand and then sit around for 20 years worth of depression to fix it. Or maybe we can just abuse our kids more and hope they grow up to be valuable conributing members of soiciety. Like vandals or unibombers. You know things we need.
tomorrow's gonna be a bloodbath for bulls
My crystal ball only shows S&P down about a point.
That correlates with my Ouija Board at the open. To review-- Monday--push up, pull back. Tuesday--ditto. Wednesday NHS (from such a reliable source) at 10am-rally.
I've noticed this really weird thing with my Ouija Board. It moves 5 times one way, 3 the other. It seems to move with the primary trend. That is, if the board is sloped down, it moves 5 down interspersed with 3 up. If the board is sloped up, the opposite occurs.
Weird.
Weird? Not really. Measure the distance moved each time and I'm sure you'll find that they can be reduced to Fibonacci numbers. Sounds like a perfect Elliot wave count to me.
video of Pento walking down Broad street..
http://www.youtube.com/watch?v=wuJerSqy1cs&feature=related
here's the link to Pento's website
http://www.greenfaucet.com/the-market/mea-culpa/23373
This post is full of win.
"We need more asset bubbles, a lower dollar, less savings and more consumption."
Just as we need fewer asset bubbles, a higher dollar, more savings and less consumption - all at the same time.
"There is only one man who understands me and even he does not!"
-Hegel
We're all Hegelians now.
CW
Hillarious. But, a question from the simple minded (like me.) Did Pento really submit this? Or is Tyler channelling Benjamin N Dover III?
Better be careful, Tyler, CNBS will be claiming that you are guilty of impersonation or slander or something.
On second thought, maybe not. Doubt if Pento will ever appear on CNBS again.
It takes little effort to scroll up. But for the less than ept:
http://www.greenfaucet.com/the-market/mea-culpa/23373
There is an excellent book on the way a gold standard would work today, if you take the time to read it....
The Way the World Works, Jude Wanniski.
I heard him in the 90's at various analyst meetings, it still hold up. After all again, the only question is how do we get from the sh1t pile to the rose....quick!
Thank you, Crzyhun.
I'm still asking the Austrians, the Friedmanites - Hell, even the Keynesians - to look at the "Market" (You know...the "Market"?) - to see if, absent the shenanigans, the manipulations, the 3:30 "Up ramp of DOOM" and all if there isn't a significant amount of people who are, just as they did while following the debate leading up to the passage of Smoot-Hawley, waiting to see if the Government is really going to drive us over the cliff.
The thesis is empirical and verifiable. If, as we approach the passage of DrubCare and it looks like there will be a Senator Jack Wilson triumphantly proclaiming, "We have the votes!", and the Market goes through the floor, we will know that Wanniski was right.
CW
disagree. supply-side fraud economics went out with 'trickle-down'..
http://www.amazon.com/World-Works-Anniversary-Gateway-Contemporary/produ...
I'm with Erin Burnett. We need more inflation so people will feel more gooder about themselves. That Penta guy needs to get with the program.
Right, that way corporations (other than wall street of course) can give 3 percent raises to the worker bees so you can feel like your getting something, when actually you are getting nothing.
I think the "inflation" that "A-cup Erin" was referring to is the kind that comes from a pair of 500cc breast implants.
Definitely makes the recipient "feel better" -- in more ways than one.
Pentonomics! I love that guy. I think he is the guy who is always on with Kudlow but could be wrong. I think I've seen him tear through some of those decagons!
There were crazy asset bubbles on the gold standard, there were depressions, and expansions. The middle class ebbed and flowed. Economists understanding of the economy was not better 100 years ago then it was now.
But understanding of the economy was better hundreds of years ago. Look up the history of the solidus. A true gold standard for hundreds of years.
It is not just a gold standard we need, but a reduction or elimination of fractional reserve lending.
there is nothing wrong with fractional reserve
lending provided that it is managed and
regulated properly....
the reason why it has become so risky and problematic
in this depression is because the reserve ratios were
so low and the quality of the bank held assets
so low that any hiccup would turn into whooping
cough....
the regulators failed to take prompt corrective
action in shutting down insolvent banks, the
ratings agencies issued knowingly false ratings
on junk which was in turn purchased en masse
by freddie and fannie....when the economy went
into the crapper these stresses created craters
where there should have only been cracks....
and of course the derivative situation was
nanothermite sitting atop a tinder box.
+1
The problem here folks is that power corrupts and absolute power corrupts absolutely. Fiat currency, the Fed, fractional reserve lending: They are all just tools. The problem is that they are in the hands of people with too much power. They are effectively unregulated. And even if they were regulated, the regulators are all captured.
Those in power will do everything they can to keep you from seeing this as a question of too few people having too much power. They'll make you think that the gold standard is the answer; or that we had TOO MUCH regulation; or the wrong kind of regulation; etc.
No one will ever suggest, however, that a single unitary President may no longer be an appropriate executive leadership for a country with nearly 400 million people in 2009, when it worked just fine for a tiny fraction of people in 1800. Or that ~500 legislators may be too few for nearly 400 million people. Or that 2 parties is fucking ridiculous. Or that the Fed's leadership isn't accountable to the people, or is too concentrated in too few people, etc.
Those in power will NEVER suggest they have too much power. But that's precisely the problem. Water down their power, decouple the corporate money flow from capturing them, add more political parties to break up power blocks ...
I agree that a two party system is fucking ridiculous.
Asset bubbles were smaller in size and far less frequent under the Gold Standard because it severely limited the amount of leverage that could be employed.
Surely you must reccognize this.
There were crazy asset bubbles on the gold standard, there were depressions, and expansions. The middle class ebbs and flows not based on if we are on a gold standard or not.
in some ways that is true but the value of the
gold standard is that the value or quality of
your assets (gold) cannot be manipulated by a central
planning committee....gold preserves wealth...
there is no way to eliminate economic cycles
except by more virtuous investing....
Charlie Gasparino is Trig's real father!!!
so how do us joe blows game the system now? honestly I really want to stick ti to the man. give me some advice. as a middle class sucker, who actually believed in the rule of law and all that jazz, how do I score some of that obama money and cash out before the real suckers get fooled?
STOP PAYING TAXES in any form. Get on unemployment, W-2's are for idiots.
STOP PAYING TAXES in any form. Get on unemployment, W-2's are for idiots.
So is filing (depending on how far one wants to take voluntary compliance).
one need only read through quatloos to find out how thats working for them.
Food stamps, tax credits (rent-a-dependent.com), gov guaranteed loans, grants and assistance for healthcare, housing, insurance, education, and even loan repayment.
It helps if you are a minority, but if you are not a minority, you can always be gay.
Food stamps, tax credits (rent-a-dependent.com), gov guaranteed loans, grants and assistance for healthcare, housing, insurance, education, and even loan repayment.
It helps if you are a minority, but if you are not a minority, you can always be gay.
I heard somewhere that plastics are the wave of the future.
Plastics, Benjamin, plastics...
Use zero credit products! Refuse to engage with the fractional banking system to every extent possible. Barter your work product whenever possible. Engage with your neighbors & community. Get and stay informed. Stand ready to reconsider your considered opinion.
nice rundown of the fed's printing scheme here
http://www.chrismartenson.com/blog/shell-game-how-federal-reserve-moneti...
Pento for Congress! Of maybe when President Hoover gets thrown out, you can run for the "O"val office!
Keep fighting the good fight.
"When a true genius appears in the world, you may know him by this sign, that the dunces are all in confederacy against him."
- Jonathan Swift
Excellent Michael!
Just waiting for the market to implode and Michael to come back on CNBC with, "Told you so"!
When the market implodes, CNBC won't be able to afford a broadcast signal anymore, so Pento will need a megaphone and a soapbox. Or the ghost of Jim Jones will serve the staff of CNBC a new batch of Kool Aid and take them all to that Bull Market heaven where green shoots are always in bloom, the sound is always on, there's never a down tick and Dennis Kneale is the mayor.
In reality, at best all the talking heads will claim "nobody could have seen this coming". At worst they will blame Pento for being an apostate or heretic.
What will be the next bubble? Land and structures, done. Technology, done. Communications and internet, done. Stocks, bonds, derivatives, done. Durables, done. Vehicles, done. Capex, done. Industrial machines and tooling, done. Movies, games, entertainment, done. Debt rollovers, debt innovations, done. US Treasuries, done.
Retail, done. Commodities, done.
What will maintain or raise middle class wages? What other widely held asset can be inflated that can be held by most of the nation?
I can only envision sending checks to every warm body, debasing the dollar, or causing inflation of such proportion that all hoarded wealth is smoked out and spent to avoid loss.
What else is there? Land, water, air, energy?
Porn bubble?
TD,
Comments being queued for moderation is very Orwellian. Your private site and you can do what you want just a little surprised. Comments can stand on their own as well.
Whoah someone cleaned them up comments real good dont they?
Tyler man you're pandering to Michael Pento, huh? Although people might like his stand on Federal Reserve, some might not buy his hyperinflation theme. Time for some censorship here i guess :S
???
My comments aren't queued for moderation. Maybe just unregistered users? Seems fair to prevent spam.
Michael Pento, we love you for your courage and your honesty! Thank you, thank you, thank you!!!
Great stand up performance, Michael! You may have come off as too strident, but the crack-smoking clown from Wells Fargone with the greatest % of RE loans needed to giggle to beat the blues. I think the Gold may have worked, but not so much because it was Gold as such, but that it was a standard. More important is the discipline and the expansion of credit match. The major point being if Gold were no longer able to be mined for whatever reason, I cannot see a rational case where it should limit an economy's growth...back to the discipline and since "sic semper pecunia fugit", we could just as well be on a Peace standard. In other words, Capital would flow and economies would grow and be treated best where Peace exists and in direct proportion would credit expand safely in that good faith. Only a psychotic culture wouldn't see this simple truth. Are Blackwater-operated drones in Waziristan working for us? Gold is done; with the stroke of a pen..remember March 1933. Who's your Daddy? If you don't live in the truth, you die in a lie. The reason the banks aren't lending is because they have no real money to lend, and know there is no economy to be able to pay it back. It's just a regular, old tsunami and the survivors won't be the ones that went down to the shore to pick up the free shells exposed by the receding tide....
I was looking for answers about the Fed, and found an old book published in 1936 with parts of the Federal Reserve Act as an appendix, and one noteable part that i read said that the Federal Reserve (remember privately held Federal Reserve) has the right to charge interest to the US Government on any money that is put into circulation that is not backed by gold or silver. Is it any wonder that this privately held company would not be a proponent of non gold/silver backed money? Problem is, so few people even know that this is a privately held company, nor that we are forever in debt to this company for the fact that the Federal Reserve Act allows this.
Forget the audit, go for the Jubilee. Nationalize the FED, not the member Banks. When JP Morgan died, he owned not more than 20% of his companies thanks to his crack FED dealer.
Colonial scrip?
Don't say colonial scrip. It makes central bankers go crazy.
River, And your point is?
Someone posted a link to Seth Goden and TED yesterday. The main takeaway is that a blog alone will not bring about change. We can sit back and watch the mafia-esque culture of politics, finance and business destroy the very fabric of what Adam Smith envisioned in capitalism. Or instead we can rise up en mass and voice our displeasure with the way this country now works. This is not a partisan diatribe, the whole system is corrupt, from each branch of govt. to the boardroom and everything in between. Americans are a fair people, with common sense and a sense of right and wrong. It blows me a way that we all know the system is a sham and yet we just take our medicine everyday and hope to take out a few penneys here and there for ourselves. The game is fixed, and if you aint one of the anointed players, then you are betting against a stacked deck. There are more of us that are discgusted than you would think. A start you ask? One term limit for all politicians!!! Take to the streets!!!
" And as long as foreigners buy our Treasuries,
who cares about how large the debt grows. "
and if they don't buy them, we will !!!
The world has officially gone insane. The few sane ones left in places like this are VASTLY outnumbered. Find a cave. Hunker down.
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