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Obama To Nominate Three Keynesians to Federal Reserve Board

Econophile's picture





 

From The Daily Capitalist

Here are the Obama Administration's three nominees to the Federal Reserve Board:

Janet Yellen, 63 
President, Federal Reserve Bank of San Francisco 
Prior Positions: Professor, University of California, Berkeley; Chair , White House Council of Economic Advisers; Governor, Federal Reserve Board 
Education: Yale , Ph.D. (Economics); Brown , B.A. (Economics)
Academic Interests: Unemployment and labor markets; monetary and fiscal policies; international trade and investment policy.

Peter Diamond, turns 70 on Thursday 
Professor, Massachusetts Institute of Technology
Prior positions: Professor, University of California, Berkeley 
Education: MIT, Ph.D. (Economics); Yale , B.A. (Mathematics)
Academic Interests: Social Security, pensions, taxation.

Sarah Bloom Raskin, 49 
Maryland Commissioner of Financial Regulation (Aug 2007 to present) 
Prior positions: Managing Director, Promontory Financial Group; General Counsel, Worldwide Retail Exchange; General Counsel, Columbia Energy Services Corp; Counsel, Senate Banking Committee; Staff, Federal Reserve Bank of New York; Staff, Congress's Joint Economic Committee 
Education: Harvard Law School, J.D.; Amherst , B.A. (Economics).

They are all prominent members of the Washington-Wall Street-Academia Economics Complex, whose members shift between government, Wall Street, and academia. All of the nominees are Keynesian economists. They are known as regulators, technocrats, and inflationists.

They will fly through the nomination process. This will mean that Obama will have appointed four of the seven governors of the Board.

 


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Fri, 04/30/2010 - 03:59 | Link to Comment Mefistofeles
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Actually I doubt any of them are real Keynsians.  The economist Minsky actually wrote a great a Critique of Keynsian Economics:

http://www.amazon.com/John-Maynard-Keynes-Hyman-Minsky/dp/0071593012

He argued that Keynes actually did very little to shape the interpretation of his general theory after the Second World War and that he actually disagreed with some of the things attributed to him.  Minsky also writes a great critique of Keynes theory.

One of the issues that Minsky had with "Keynsianism" was that it was assumed inflation was homogenous to degree 0.  Having neither a PhD in mathematics of economics but a lowly bachelor's degree in economics I assume what he was saying is that inflation would spread out even over the economy,instead as we know inflation hits some sectors like real estate and now stocks much harder than others.

Unlike the Keynsians/Neo Classicalists who believed that a economy returns to equibilibrium after a monetary stimulus Minsky believed that economy could operate at a level that was "lower" than it's natural level and would not neccesarily return to equilibrium.

He also criticised Keynisianism because it was assumed that income distribution/consumption were stable.  In real life the rich can have huge fluctuations income.  Also the rich represent a large slice of the economy far beyond their numbers.   Therefore the income and production functions in  Keynsian theory could vary far more than the Keynsians have led us to believe.

Minsky also criticises monetary demand and supply assumptions in Keynsian theory where it's assumed that the demand for money is an endogenous variable and the supply of money is exogenous.  Of course in real life money supply can influence money demand.

Unfortunately I only got halfway through the book its a great albeit somewhat esoteric and abstract read.

Of course Minsky's crowning achievement is his Financial Instability Hypothesis 

http://www.google.com/url?sa=t&source=web&ct=res&cd=1&ved=0CAsQFjAA&url=http%3A%2F%2Fwww.levyinstitute.org%2Fpubs%2Fwp74.pdf&rct=j&q=Financial+Instability+Hypothesis+.pdf&ei=Lo3aS8rBL4vctgONzeBx&usg=AFQjCNEGT_8GYmo7ibZ8LEh_kdu7TMev1Q

This is where the credit system collapses in one massive ponzi scheme.  He had a wonderful word for financial units in this system he called the "Ponzi Finance Units".

 

 

Fri, 04/30/2010 - 03:41 | Link to Comment Grand Supercycle
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EURO buying support has returned ...

MARKET UPDATES:
http://www.zerohedge.com/forum/latest-market-outlook-0

Fri, 04/30/2010 - 02:04 | Link to Comment jimcg
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Coming soon to a theater near you; the bigger and better: "Son Of Stimulus".

Fri, 04/30/2010 - 01:55 | Link to Comment DirtySouth
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The General Theory of Employment, Interest and Money

By John Maynard Keynes

 

Nevertheless the theory of output as a whole, which is what the following book purports to provide, is much more easily adapted to the conditions of a totalitarian state, than is the theory of the production and distribution of a given output produced under conditions of free competition and a large measure of laissez-faire. The theory of the psychologi-cal laws relating consumption and saving, the influence of loan expenditure on prices and real wages, the part played by the rate of interest,these remain as necessary ingredients in our scheme of thought.

Fri, 04/30/2010 - 00:17 | Link to Comment Dr Hackenbush
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not to defend Keynesianism but this political team of butt-wipes can't even get that right.  I think its called ripping off the poor and the middle class-ism.      

Thu, 04/29/2010 - 23:06 | Link to Comment Joe Davola
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Will the war be over before my 14 y/o son is draft age?

Thu, 04/29/2010 - 22:46 | Link to Comment Privatus
Privatus's picture

Like it or not, Obama is being consistent. That's why the jackass wing is dominating the elephant wing. But they are both wings of the same bird of prey. These latest Fed appointees are erudite eunuchs who will not rock the boat. They can be ignored. Follow the money. The primary focus should not even be on the Fed sock puppet-in-chief, Bermonkey (Ben Bermonkey) but rather on the owners of the New York Fed, whose collective hand is rammed up to his larynx. One would think that the owners of America would be the last ones to bring the sucker down. Hence the cognitive dissonance.

Thu, 04/29/2010 - 21:48 | Link to Comment Jay
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Greenspan made all the right noises before he was appointed chairman of the Fed. Look how well that turned out.

Thu, 04/29/2010 - 21:26 | Link to Comment docj
docj's picture

Yeah, what could possibly go wrong?

Oh, wait...

Thu, 04/29/2010 - 21:09 | Link to Comment a_moran3
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Sometimes I think that John Maynard Keynes was created by the big banks because only Wall Street, Main Street and anyone else crooked would actually admire Keynesian Theory.

 

The latest <a href="http://www.wallstreetoasis.com/blog/how-reform-is-a-big-win-for-the-stre...">finance reform</a> is a clear case of Keynesianism and is loved by firms like Goldman Sachs and other investment giant that is in the Obama administration and the Senate.

Thu, 04/29/2010 - 20:23 | Link to Comment Econophile
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Mises was a Jew. Not to forget Rothbard. Get paranoid on someone else's post.

Thu, 04/29/2010 - 22:21 | Link to Comment JR
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Thanks for your answer.

The subject of your post is the appointment of three Federal Reserve officials, an extremely critical subject.  If comment about why they were appointed, all aspects of their qualifications, and to whom they will answer is paranoia, then it’s my opinion that paranoia needs to be a part of the discussion.  I am a student of Mises and I have personally met Rothbard and I believe I have all of his books as I do Hayek’s, which, in my opinion, is not related to this discussion.

Fri, 04/30/2010 - 00:09 | Link to Comment Econophile
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I agree this should have nothing about religion in it. I just don't like folks bringing up Jews, the Trilateral Commission, or whatever. We have enough problems based on people with the wrong economic ideas. 

Hey, I met Mises. He was an atheist as I recall. Maybe agnostic. Read Hulsman's Mises bio about what Jews did in Vienna when they let them in the city. A flowering of ideas and wealth. 

P.S. Did you see my reading list at the Daily Capitalist? It's new and you will recognize many of the books.

Fri, 04/30/2010 - 05:01 | Link to Comment Anton LaVey
Anton LaVey's picture

I agree this should have nothing about religion in it. I just don't like folks bringing up Jews, the Trilateral Commission, or whatever. We have enough problems based on people with the wrong economic ideas.

Not to be obnoxious about it, Econophile - I like you, and your contrarian ideas - but most economics is bull****, so enough with the Keynesian paranoia. You are beginning to sound like the nice people on this thread who are ranting about this or that religion, or the Trilateral Commission, or the Bilderberg, or whatever. Only your favourite target is Keynesian economics.

I agree with you on the fact that Keynesian policies, in the mess we are in, is like fighting today's war with the weapons of the last. In fact, I am even ready to say that Ben Bernanke is very, very mistaken to use QE to fight this depression. But I am sick and tired to see poor old Lord Keynes, who said quite a lot of things that were very intelligent, and are still relevant today, dragged into the mud every single day, and in almost every single one of your (otherwise interesting) articles. I will even go as far as saying that Lord Keynes probably had a lot more brilliant ideas and insights that Mises or the entire Austrian School put together.

On the other hand, I would also argue that most monetarist and "Austrian" economics is nothing more than a big steaming pile of manure, and that we are in the mess we are in, precisely because of the totally nuts ideas of the these economic schools. I will further add that thinking "Austrian" economics would instantly solve every problem we are in today is magical thinking, probably as stupid as people (Krugman comes to mind) who think that Governement spending money they don't have -- like drunken sailors in a Patpong whorehouse -- will instantly solve everything that is wrong with the world today.

"Free market" is, much too often, just an excuse for the rich and the well-connected to steal everything from the poors and the middle class (whatever that last category may be). "Government intervention" is, by the way, is, much too often, exactly the same. And I'll repeat myself: 90-95% of economics is just bull****, and, much too often, just an excuse for the rich and the well-connected to steal everything from the poors and the middle class.

Replace "rich" and "well-connected" by "Goldman Sachs" and "J.P. Morgan" if need be, but you get my drift. To borrow a nice turn of phrase from Leonard Cohen:

Everybody knows that the dice are loaded
Everybody rolls with their fingers crossed
Everybody knows that the war is over
Everybody knows the good guys lost
Everybody knows the fight was fixed
The poor stay poor, the rich get rich
That's how it goes
Everybody knows

There, I feel better now. Feel free to ignore me.

Fri, 04/30/2010 - 12:02 | Link to Comment Econophile
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I won't ignore you. I find paranoia interesting. You might want to read a bit about free market economics first.

Fri, 04/30/2010 - 01:33 | Link to Comment verum quod lies
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Econophile: I ask one simple question: as a group do Jewish Americans act purely in the inetrest of the country or more for their own group? If the answer is more for their own group (who represent half or more of the leaders in U.S. finance and the Fed) then their group affiliation is very relevant, whether or not you, or even me, personally wish to discuss it openly. If it offends you, maybe you shouldn't write about finance in the U.S., because it's hard to ignore without at least tangentially touching upon it. Are people really so politically conditioned that talking about an elephant in a room is so tough for them?

 

Fri, 04/30/2010 - 11:59 | Link to Comment Econophile
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I think of people as individuals. When we start thinking about them as "groups" that's when things tend to fall apart. Also, I think the better argument is that 99% of people in power are Keynesians.

Fri, 04/30/2010 - 04:43 | Link to Comment Anton LaVey
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Econophile: I ask one simple question: as a group do Jewish Americans act purely in the inetrest of the country or more for their own group?

And I ask you a simple question: are you totally nuts, or simply completely paranoid?

Fri, 04/30/2010 - 07:40 | Link to Comment verum quod lies
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Screw you; when you don't like a question, especially one that was asked of someone else, I would suggest ignoring it.

 

Thu, 04/29/2010 - 21:44 | Link to Comment Mr Lennon Hendrix
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If David Rockefeller says it matters not which gods people worship, it matter not.

Thu, 04/29/2010 - 19:01 | Link to Comment JR
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The critical decisions that the Federal Reserve makes on major policy and interest rates, released through the FOMC, are all dictated by the owners of the Federal Reserve Bank of New York.  Only minor differences of opinion are allowed from the governors of the Board, therefore, acquiescence is expected.  How better than to pack the Board with those who will say or do anything Bernanke requires of them.

As is becoming public knowledge, the dominance of the Fed policy over the American economy, from wages to which businesses will be funded, is coming from these big bank owners who also control major functions of the rest of the executive branch of the government, not to mention their controlling influence over the Congress.

So here is my question and I don’t suggest it lightly.  How are these prime movers of our government going to handle the rising criticism that almost all financial officials are now Jewish?  The charges will come, the public will become more and more aware of this striking phenomenon.  And now with the continuing expansion of Middle East tensions, how can the Obama Administration defend itself from an expected avalanche of bias charges?

The foundation of the problem is the complete lack of transparency on how the Federal Reserve conducts its business, who are selected as winners of financial assistance and windfalls--the banks, the businesses or classes of Americans, the foreign countries... and who are selected as the losers.

When the public gains a greater and greater suspicion that the capital markets are rigged, the public will want to know just who the rigging parties are.  And then the charges will come.  Charges suggesting an inordinate influence from Israel, suggested in exchanges like this from IAP News October 3, 2001:

An acrimonious argument erupted during the Israeli cabinet weekly
session last week between Israeli Prime Minister Ariel Sharon and
his foreign Minister Shimon Peres during which Sharon reportedly
yelled at Peres, saying "don't worry about American pressure, we
control America."

According to Israel radio (in hebrew) Kol Yisrael, Peres warned
Sharon Wednesday that refusing to heed incessant American
requests for a cease-fire with the Palestinians would endanger
Israeli interests and "turn the US against us."

At this point, a furious Sharon reportedly turned toward Peres,
saying "every time we do something you tell me Americans will do
this and will do that. I want to tell you something very clear,
don't worry about American pressure on Israel, we, the Jewish
people control America, and the Americans know it."

Fri, 04/30/2010 - 00:47 | Link to Comment htp
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You are touching on a subject that's taboo in the US but common knowledge in the rest of the world. Many Jews practically flaunt their newly acquired power, in the face of Europeans and Asians.

Ariel Sharon was merely stating a fact. He knew it before the rest of us of course.

In any case it is now an open secret, except in America.

Thu, 04/29/2010 - 21:21 | Link to Comment SamThomas
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Nothing like a little economic stress to bring out the anti-semites.   You gotta be kidding, right?  Israel controls America?  What a joke.  About the same level of sophistication as the global jewish financial conspiracy. 

We are in this mess as a result of our own lack of discipline and political courage.  It has taken 40 years to come to this point through the cupidity of America's own political class.  Ain't nobody else to blame. 

Thu, 04/29/2010 - 23:50 | Link to Comment MrPalladium
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"You gotta be kidding, right?  Israel controls America?  What a joke."

Ok, but if its a joke, why did Ariel Sharon say it? Is Ariel Sharon an anti-semite?

Are identical words if spoken by one ethnic origin innocent, but if spoken, or even quoted by another guilty and hateful?

It would appear that the offense of the words is determined not by the words themselves buy rather by the ethnicity or race of the speaker.

We are well down a very slippery slope.

Thu, 04/29/2010 - 20:05 | Link to Comment Rick64
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Excellent, but I have my doubts as to the awakening of the lethargic masses.

Thu, 04/29/2010 - 18:09 | Link to Comment suteibu
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Hah!  I read it as Kenyan at first, and had basically the same reaction as when I realized it was Keynesian....dear lord.

Thu, 04/29/2010 - 18:03 | Link to Comment anony
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And not a Gentile among them.

The zionists are in total control of the government. From top to bottom, inside out.

WHY?

Thu, 04/29/2010 - 18:13 | Link to Comment Rainman
Rainman's picture

If they were really in control of the government, they would never let a guy with a Muslim father and the middle name of Hussein get the top job. Does not compute.

Thu, 04/29/2010 - 18:52 | Link to Comment nmewn
nmewn's picture

I never realized gangsters cared what color or religion a member of the gang was...only that you were one of them and would share in the heist should they become separated in the getaway...LOL.

My sense is...the longer we stay at each others throats bickering about who had guard duty the night of the robbery, the further the gang get's away from the scene of the crime.

Just sayin folks.

Thu, 04/29/2010 - 19:19 | Link to Comment Thunder44
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It's all about the best puppet to advance the agenda.

Thu, 04/29/2010 - 18:29 | Link to Comment anony
anony's picture

If you think theBamster is anything more more than a lump of coal, and a jewish puppet I have some oil in Mississippi I'd like to sell you.

A jew can't win the White House, yet, as Lieberman so amply demonstrated in the latest bid. The POTUS has no power on his own. Without the men and wimmin behind his throne and those are the good folk at Goldamn Sucks, Hollywood, and AIPAC, he is toothless and as weak as a new born babe.  

Thu, 04/29/2010 - 18:02 | Link to Comment Gordon Freeman
Gordon Freeman's picture

"All of the nominees are Keynesian economists"  This is a surprise??

Thu, 04/29/2010 - 17:54 | Link to Comment Blaise Pascal
Blaise Pascal's picture

Isn't anyone an Austrian anymore?

Obama, Geithner and Bernanke, along with Paulson (and less so, Bush) are destroying this country.  Fiscal situation is catastrophic, and I never would have believed they would permit the destruction of the currency, and the stoking of hyper-inflation.

Lesson I have learned: ZIRP plus fiscal disaster -> risk-free money for non-lending banks -> recovery.  Counter to every instinct and lesson I have been taught. 

But so true.

Blaise Pascal, Mathematician, Philosopher, Gambler

Thu, 04/29/2010 - 18:02 | Link to Comment Ragnarok
Ragnarok's picture

Just thinking out of the box here, but perhaps it is all on purpose.  Suppose we are in a grand cycle, and in this cycle we have amassed the most gold, biggest army, large agricultural base, intellectual base etc...  Just hit the reset on all fiat paper, does any of what I listed change? Are there any viable challengers who would survive in any better shape? Probably not.  So why not party hardy while the booze is still flowing?

 

Remember I was just thinking outside the box...

Thu, 04/29/2010 - 20:31 | Link to Comment tip e. canoe
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"most gold"  supposedly

"biggest army"  empire's a bitch

"large agricultural base" god bless GMO

"intellectual base"  you sure bout that?

"etc... "  like those secret confiscated tesla patents?

 

Thu, 04/29/2010 - 19:39 | Link to Comment Argos
Argos's picture

I thinking about the same thing.  When TSHTF, America is in a better position than most, but; remember, the bigger they are, the harder they fall.  I imagine that most third world countries will hardly be effected.

Thu, 04/29/2010 - 18:13 | Link to Comment Blaise Pascal
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There's no doubt it is all intentional.  The challenging question is, to what end?  And once you start down that road, it's almost inevitable to a conspiracy theory.

And that is just too mind-boggling, even for Blaise.

Blaise Pascal.

Thu, 04/29/2010 - 17:50 | Link to Comment Ragnarok
Ragnarok's picture

I love reading the evolutions of comments that has taken place over the last year, it's like the 12 stages of grief.  I think most of us have reached acceptance that we are being systematically fucked by the powers that be.  So, my question is how to we adapt and prosper in such a world?

Thu, 04/29/2010 - 19:39 | Link to Comment dumpster
dumpster's picture

how to adapt

 

serpentine

Thu, 04/29/2010 - 18:06 | Link to Comment anony
anony's picture

Why adapt?  That seems already like a resignation, or forgone conclusion.

There is the option of armed protest, like those good folks from Georgia yesterday who were too careless. 

 

Thu, 04/29/2010 - 17:48 | Link to Comment unwashedmass
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glad i have physical gold and silver. we're sunk.

Thu, 04/29/2010 - 17:23 | Link to Comment Gordon_Gekko
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Who gives a fuck what the names of the puppets/slaves are?

Thu, 04/29/2010 - 17:21 | Link to Comment Mitchman
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YAAAAAAAAAAAAAAAAAAAAAWWWWWWWWWNNNNNNNNNNNNN.

Thu, 04/29/2010 - 17:17 | Link to Comment ghostfaceinvestah
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As Gerald Celente would say "Princeton, Harvard, Yale".

Can't we get some fucking diversity in this country?  Enough of the Ivy League groupthink.

Thu, 04/29/2010 - 20:18 | Link to Comment Cursive
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+1.  And I can hear him echoing in my head right now!

Thu, 04/29/2010 - 17:07 | Link to Comment sysin3
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"We can't solve problems by using the same kind of thinking we used when we created them."

Albert Einstein

As I recall, he was a pretty smart fellow.

Thu, 04/29/2010 - 17:03 | Link to Comment BlackBeard
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Nice.  It's like Bush, but black with no dyslexia.

Thu, 04/29/2010 - 16:58 | Link to Comment dcb
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headline should be: obama appoints more of the same failed policies that got us into this mess to the fed.

Thu, 04/29/2010 - 17:16 | Link to Comment akak
akak's picture

"Keynesian Economics" is a contradiction in terms, as was "Marxist Economics", and serves exactly the same purpose as the latter --- not as an actual intellectual framework or theory, but merely a glorified and elaborate, but cynical and self-serving justification for plunder of the citizens' wealth and savings by national governments and central banks.  It is functionally nothing more than the power elite's ritualistic liturgy serving their religion of theft, fraud and domination.

Thu, 04/29/2010 - 21:33 | Link to Comment akak
akak's picture

OK, who "junked" me!

Bennie B, was that you?!

Do NOT follow this link or you will be banned from the site!