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QE 2 Was A Disaster: Here Is Why US Fiscal "Stimulus" Was A Complete Failure As Well
Two and a half years ago, Christina Romer, then still employed by the Obama administration in the position of Chair of the Council of Economic Advisers penned "The Job Impact of the American Recovery and Reinvestment Plan" - a report predicting the impact of a fiscal "stimulus" that took out $787 billion from the pocket of American Taxpayers (subsequently discovered to cost even more) and put that money...somewhere. We are not sure where, because according to a chart now made legendary for its complete failure to predict the future, it sure did not go into creating jobs. Below we present the original chart that made the January 10, 2009 presentation, and superimpose upon it the reality of the past two and a half years. It is simply stunning. And while we are here, and discussing the abysmal failure of QE2 (the impending arrival of QE3 notwithstanding), it is amusing to hear the whimpering of the likes of one Richard Koo, who is now claiming that all along the money from the Fed's monetary stimulus should have been invested in the form of a fiscal one. Well, Dick, below is the impact of your fiscal stimulus....AND it also includes the impact of $2 trillion in incremental monetary stimulus. Combined, both fiscal and monetary stimulus has now missed the worst case projection for US unemployment for 30 months running. Here is the simple truth: both monetary and fiscal stimuli are abysmal failures, when the economy is mean reverting to a state where it was hijacked from courtesy of 30 years of "great moderation" - and there is nothing that can be done to stop it. Correction: there is one thing - the Fed can destroy the dollar in its attempt to disprove simple physics. And, ultimately, it will.
From the original ARRA proposal:
And the outcome:
Nuff said.
h/t Mike
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The Federal Reserve is the largest counterfier in the history of the world
Actually, in our fractional reserve system, it's the banks that counterfeit most of the money. See the paper from the chicago fed entitled modern money mechanics.
"The actual process of money creation takes place primarily in banks."
http://upload.wikimedia.org/wikipedia/commons/4/4a/Modern_Money_Mechanic...
I spoke with Benjamen Shalom Bernanke today and he said there would absolutely be QE3 and they'll probably call it Quantitative Debt Monetization. The pigs just have to squeal loud enough for it first, and they will.
What would a worldwide Bond Market collapse look like?
No really, I want to know.
Paint a picture for me.
Just heard on CNBC World;
Japan needs a specific type of crude. A light sweet crude, especially after their natural disaster, and they ain't getting it from their chief supplier, Libya, due to the little thingy they have going on over there.
Now we know why Obama wants to get that Libyan oil on line as soon as possible.
Humanitarian reasons, ie: Japan.
Conrad,
THanks much for the post.
These guys i the FED aren't really very bright. In fact, considering the import to the country I have to say they are "faking" their expertise.
Junkers dislike the truth
Sorry bout dat!
I'm just a crack junkin' monkey.
Here is the true counterfeiting, which is not only allowed, but they've made it a necessary part of the ponzi scheme which all economic activity depends on (the 1.5 trillion or so in treasuries Bernanke & Syndicate have purchased have the potential to create credit/debt *they are the same thing* on the order of approximately 15 trillion; never mind that the demand and/or ability to tap that credit just isn't there and won't be there for a long, long time, hence the reason the tailspin will get worse and the crash into the mountain side will happen. And even if the demand and/or ability to tap even, say, 25% or more of that credit did exist, it would hasten the destruction of the economy, as it no doubt indicate a new bubble has been launched, allowing broad participation and broad new indebtedness. No win situation).
The velocity of the destruction wreaked by Modern Money Mechanics, as admitted quite candidly within the very text of the instruction manual that guides the very actions of the Federal Reserve, is astounding, and there can be little doubt, when simple and accurate math is done, that we're approaching the implosion, regardless of what form it takes (pick your poison as it makes no difference in the practical result of the outcome).
QE1 and QE2, thus far, have sewn the seeds of the next major crisis, which will be an intense one, and is closer in time rather than further (see ZH's article on margin utilization, which has similar implications).
Modern Money Mechanics: How To Make and Destroy MoneyGood post, I remember this from a long time ago.
It is true, there is nothing new under the sun, just variations of what has come before...some people run "legal" ponzis...some don't.
I also saw this some time ago. This time I am keeping it for reference.
Ummmm, you can't seperate the banks from the Fed. Money is created when it is borrowed/lent and destroyed when it is removed from circulation, ECON 101.
USD-JPY 79.9453 -0.1455 -0.18as of 3 minutes ago.
Damn, sub-80, alarms are going off at every fx desk on the planet, carry trades collapsing, meltdown city.
Don't worry, they'll just short more silver.
http://www.youtube.com/user/BrotherJohnF?feature=mhee
"The actual process of money creation takes place primarily in banks."
I disagree. In order for banks to create money, there has to be some kind of repo/loan operations from central banks.
awwww. but you told me you loved that class!
Wouldn't mind if someone made a few counterfeit copies of you ! Anonymous 2011 http://trololololololololololo.com
Monedas!
Cual es el proposito de tu trololol...?
Baby Blythe has a new photo.
that fat pig Romer should be hanged , if you can find a noose large enough to fit around her flabby neck
-1
+2
+3
+4
At least her diabesity will be paid for with Obamacare until we lose reserve status.
obamacare sucks; it is not worth being called public health insurance. i would bet romer is covered under a whole 'nother plan.
+ 5
oops, duplicate.
but to quote Animal House:
"Fat, drunk and stupid is no way to go through life son."
Prove it.
I wasn't drunk.
Signed,
Christine
http://www.youtube.com/watch?v=bK-Dqj4fHmM
Well, I am skinny, getting drunk and without doubt stupid. One and a half out of three ain't bad!
Michael Moore made his way through.
i still get her confused with donald trump
I actually think she's a slightly uglier version of Ned Beatty in a wig.
T.E.I.N. everyone!
P.S. Tyler - absolutly awesome commentary...I couldn't agree more. Mean reversion to the true state of economic equilibrium after 30 years of juicing the Klepto paper markets while they globalized the real wealth: productive capacity!
ooh, you are right
I wonder how that chart would look like, when considering all the people that have been made "disappear" from those stats.... actually, that's untrue.... i know the stats already ( http://www.shadowstats.com/alternate_data/unemployment-charts ).
True dat....
The chart uses BLS numbers....just imagine what the actual curve would look like!!!!
T.E.I.N. everyone!
This chart makes it slam-in-your-face obvious government cannot properly allocate capital. Are there any more socialist out there or do you need to see the chart again?
and neither can their privatized arms --- the TBTFs.
Not the United States government.
It is not that they "cannot", but that they "do not want to". Also, the only kind of "socialism" which QE+ did, was bankster-socialism.... While i agree that just throwing money at problems is no longterm solution (and incompetent too), i can think of a few hundred better ways, where all that money could have gone to.
Or to phrase it in your terms: They didn't just do mass-socialism.... they didn't even attempt to allocate it in a way that is useful to the population (as you said already).
P.S.: Or as the greeks would ask "Where the fuck did all our money go?"
At least the Italian government would have thrown a party.
Well, they EACH MONTH pump as much money, as 50% of low income wages for ALL CITIZENS OF THE USA.
You can have a really big party with that..... EACH DAY.
Would it be a total waste of money with no longterm benefits?
Yup.
But it at least wouldn't have resulted in longterm HARM, by keeping those zombie banks alive. The whole QE program is worse, than throwing money out of the window.
Its funny to think that if "helicopter Ben" had followed through with the idea that earned him that nick name, he would have done more good than what he actually ended up doing.
Turbo Timmy and Bubble Ben.
Just two of the many marionettes.
Seeing as how they pissed such a colossal sum of money out the window and accomplished fuck all...why didn't they just pay all the banks holding MBS to cut eveyone's mortgage by 50%, across the country?
Wouldn't that have given them the super-charged kick start they were looking for when all these short sighted under-water home owners now felt like they had won the lottery over night and started spending and racking up new debt like there was no tomorrow? Not to mention that banks would now be compensated for the home value that has been lost in the last 3 years anyway.
Yes, but the problem with your suggestion is...nothing the Fed or the Feds have done was intended to fix the economy or enrich Average Joe. The debt they have created is the instrument which they will now use to break the Republic and consolidate power.
This tactic was most clearly demonstrated In Libya where, for some then unknown reason, the establishment of a Rebel Central Bank was of the utmost importance at the beginning of the conflict. As well, look at the goodies that are in the pipeline to be stolen from Greece.
The debt created is the yoke, the shackles and the chains used to assume power, which is why the ECB will do almost anything to avoid any sort of debt default.
I'm wondering how they want to do this though. I mean, look at europe.... once you push people too low, and especially too fast, they rebell. I don't see how they successfully want to pull this off, without provoking civil war, slaying it down, and implementing dictatorships everyhwere.
As low as an opinion i do have about humans, it looks to me as if their bet is too greedy. They will not be able to keep the slaves as slaves, unless they treat them as slaves... and part of that is not pushing them below their comfort zone.
Honestly, i think they've made a mistake. Just because something works in 3rd world nations, doesn't mean that it will work in 1st world nations.
Well, you are seeing it on a weekly basis with threats coming out of Treasury and criminal syndicate Wall Street banks, saying that if the debt ceiling is not lifted, armageddon will be upon us.
Ummm...do you think that war against American couch potatoes and iPad zombies is amongst the Feds' greater concerns? I don't think so.
Americans enslave themselves financially every single day, and of their own accord. iPad zombies have already had their shackles fitted, and smart phone addicts already have their locations reported by Apple...for easy pick up. What are you talking about? You are obviously not American.
As for whether or not it works in America, well, that remains to be seen. There are signs of hope, but the upcoming debt issue is very important to determine if any substantial awakening in the American spirit is out there, alive and well.
Correct.... i'm considering the current path of events, from an european POV.
+1
I think the propaganda machine is doing the job for them. Turn on the tube on any news channel and they're telling you who to hate and who's to blame. The intellectually lazy population follows along. Look around. Very few people realize that the money changers and gov't are the real problem. Some hate mexicans, some hate welfare queens, some hate unions, some hate the "rich" (the rich being >250K income, as theyve been told by Obama). It's easier to divide Americans than it is to divide a less diverse population.
You know, I hear what you are saying, but the above statement simply is not true in my experience. Sure, there are many now that have been hooked into it via the welfare state movement...but to suggest that very few Americans realize that the Federal govt is the problem is simply not true.
People may hate the fed govt..........but only until they are collecting unemployment benefits. Gov't needs the money and capital from the elites but it also needs the support of a large sector of average joe's. Almost half of all Americans rely on govt in some way or another for their income. Unions, unemployed, welfare recipients, govt workers etc Have been bought off. They're not gonna bite the hands that feed them. The more things get worse the more these bought off classes ask for govt to "do something" to save the "economy". The Feds are glad to oblige;-)
they have jobs.. pensions and children to think of, they are in no position to challenge the goverment.. who would take care of the lawn?
Pensions? LoL, Not anymore....
so the 1st world becomes a 3rd world and it will work. see, problem solved.
That theory was laid out quite some time ago and, of course, the folks like Glen Beck, and others, who picked up on it were hammered by the MSM propaganda machine. Now, with the advantage of hindsight, a few facts and a pencil, the theory appears to be spot on.
It is enough that the people know there was an election. The people who cast the votes decide nothing. The people who count the votes decide everything.Joseph Stalin
You know, a lot of folk on this site gave Glen Beck a ton of crap. While I know he was not the definitive source on matters, he sure was working hard to report a lot of this stuff. Not sure if that was a troll movement here, or if folks just saw it differently then I saw it...Beck that is.
For whatever he may lack in definitive, expert information, he makes up for in the size of the bell he is ringing. He is clearly working in the same direction as ZH.
IMHO nearly all the people who junk Beck don't watch his show. He is clear on where he gets his information from & the books he recommends. I had read many long before Beck and discovered some afterwards (like "The Road to Serfdom" which has been a topic here on ZH). He encourages people to do their own homework, stand for integrity and help their neighbors. All real radical ideas.
I am a firm believer in the people. If given the truth, they can be depended upon to meet any national crisis. The great point is to bring them the real facts.Abraham Lincoln
.
For a nation that is afraid to let its people judge the truth and falsehood in an open market is a nation that is afraid of its people.
John F. Kennedy
Agreed, macholatte. Beck comes at these things in very broad strokes, and then talks to folks who know the details, or uses great books to back up his points. I consider him a patriot in the same battle engaged here every day. I just remember a lot of dung tossed his way on this site.
We agree on Beck.
And indeed, it is quite clear that "the nation" is getting quite nervous about what "its people" are about to think of the truth...as it now comes out that the Summer of Recovery has been postponed indefinitely.
+++ Glenn Beck.
He has the addiction cred to back up his rants.
Beck may be on board the revolutionary train now that a democrat is in office, but he was singing the praises of GW and iraq war, etc. not too long ago. His main agenda is to tell the couch surfers on the right what they want to hear.
Glenn Beck is just like every other pundit in the mainstream media - - he marginalizes the truth. Even when he says something that is somewhat true, the power of that truth is instantly negated by his ridiculousness, and thus it is never an idea that poses any danger to the status quo.
Glenn Beck: "To restore America we need less Marx and more Madison"
Now, of course, part of this statement is inherently true. Madison was brilliant and Federalist No.10 - - where he explains the dangers of factions and the safeguards provided against them by a constitutional republic - - is one of the most powerful documents written during the formation of the Constitution.
If the majority of Americans understood what Madison was saying in this essay, they would be able to understand why our system of government is now broken and cannot be fixed using the system itself. It has been usurped by a faction that Madison couldn't have anticipated - unelected private central bankers.
So, sure, on one level Beck is right - we do need Madison's ideas to restore America to the constitutional republic it once was. But then, of course, he totally marginalizes that truth. In context, by "less Marx", he doesn't mean Marx's ideas; rather, he invariably means the false propoganda of Fox News: "less socialism", "less progressives", less "Democrats and Obama".
Cdad, I give you the benefit of the doubt based on your posts, but you have to understand that there are so many people who follow Beck that have no capability for independent thought and are incapable of making connections on their own. They take Beck at face value. If Beck were like Palin, I wouldn't care at all. But the fact that he makes references to the founding fathers/constitution and yet doesn't tell people the real truth is treason of the highest order. He marginalizes brilliant men and their brilliant ideas with the left/right world of sycophantic insanity.
"The progressive movement is the lunatic fringe of the left. It is the home of everything that you despise. It is the home of income tax. It is the home of prohibition. It is the home of the Fed."
That's right, he blames the Democrats for the Fed, ignoring reality in favor of placating his supporter base. He is a coward. He could actually make a difference with his popularity if he wanted to. I absolutely resent the implication above that he is doing the same thing as ZH. In reality, he is doing the exact opposite - marginalizing the truth.
"I think the president is a racist, I think he has race issues. Don't know if he hates white people, but there's something going on with the president. Well, I stand by that. And I deem him a racist based on really his own standard of racism, the standard of the left."
"When I see a 9/11 victim family on television, or whatever, I'm just like, 'Oh shut up' I'm so sick of them because they're always complaining"
"The only [Katrina victims] we're seeing on television are the scumbags."
And there you have it, instant credibility loss. So even if he was getting at a worthwhile message, he would ruin it for everyone. It makes you wonder if the Banksters themselves aren't behind Beck in the first place.
He is the antithesis of a revolutionary.
Sleep on that Beck supporters.
I think there are people who do have a better grasp of financial matters, for example. However, whatever mistakes Beck may have made from time to time DOES NOT legitimize the above quote. Considering that there are only a handful of people on television addressing the things Beck is addressing [Napalitano as one example], I give him the benefit of the doubt.
I agree that his presentations are sometimes less than complete. However, that does not zero out his credibility or lead to the conclusion that he is buffoon. What I see in Beck is a man not unlike myself, figuring these things out as he goes. It is a testament to the opposite of what you suggest, a testament to the strength of his character, that he does the best he can with the hour of television that he has each day.
I do not disagree with [a few of] your assumptions, but rather the conclusions you have drawn from them. And I don't need to sleep on the matter. Beck has awakened many. Of this, I am quite sure.
Fully agree! Those who trash Beck's search for truth are usually blind Progressives or fully informed Progressives that are very afraid of what he is sharing with the masses. If there was someone on the far-left doing what Beck is doing...I would applaud them. Beck isn't just pissing-off Progressives...he's also pissing-off much of the Big Money Men who have captured the far-right political agenda. He has attacked the Financial Elites that have destroyed the world economy with the same vigour he has used to uncover the truths about left-wing government funded organizations. His major flaw however is similar to Bill O'Reilly's blind Neo-Con patriotism (the military can do no wrong), and their support of the flawed (and evil) far-right agenda of lower taxes for the rich....you know, the "trickle-down" bullshit that has led to the largest capture of American wealth but the top 1% of earners in history!
In a world shrouded in lies, I appreciate truth in whatever political form it takes.
T.E.I.N. everyone!
Glenn Beck is a buffoon. Anyone who thinks otherwise is part of the problem.
Beck is a lot more effective on TV than he was on the radio ! I like the professorial style of his program ! I don't get him here in Bonefuck, Egypt but a friend drops me off a DVD once in a while ! I am Monedas 2011 Following the Romney campaign here in Satan's Asshole, Massachussets !
Monedas, you are a pure baffoon. You are Monedas -- You are a baffoon!!!
And with that, have a nice week...............
'All that is necessary for the forces of evil to win in the world is for enough good men to do nothing.'
Came to me in a dream. Think this has legs.
Excellent quote. Think I'll add that to my campaign...
But, but, but.....If we just gave money to regular folks, then it wouldn't be 'trickle down'!
Giving money directly to people would just create direct inflation (not that it's much different now after a bit of lag).
However, the cash could have been used to actually strenghten the economy, rather than the financial sectors.
Or wait..... i have a totally weird idea.... weren't they whining back then, about the evil crash that would happen, if they didn't bail out the banks? Well, let's see - they have now for years each month printed 50% of low-income wages multiplied with the population of the USA..... surely, such a giant amount of cash should have been sufficient to soften such a crash? Could the USA with current inflation-rates, now be just as well be beyond the amputation of the banking cartel, and on the way up again? Nah, impossible.....
"The crash" as you refer to it, and your sense that it could be cushioned...you are presuming the Feds/oligarchs want it to be cushioned. Your premises represent the weakness in the points you are trying to make.
During this "great reflation trade," wealth was massively transferred from the population to the asset wealthy class. Now that this QE2 money has been gobbled up, and since it appears that there is no immediate move to QE3, a crash would be just fine by a lot of these folks. It will restart the cycle again. A crash is great when it is on their terms.
Actually, i a few posts above explicitely corrected another member, that the fed and the banksters have no interest in this, and are on purpose not doing this.
My little remark only had the purpose, to strenghten this point: To show that all the money that was printed and given to the banks, not only did not prevent the evil downfall.... but instead the other way around, NOT giving it to the banks is exactly the strategy which could have prevented the downfall. So, not only did they not succeed in their mission - they did the opposite of their claimed mission.
Rynak;
The Treasury/FED bail out in 2008 was done to reflate and save the 5 largest banks in the US as well as the largest 2+ banks in Germany, England, France, Ireland and Spain as well as the "city of London."
Saving these banks enabled the current world wide debt based monetary system to claim that recovery to pre 2008 status has occurred. The fact is that it has not recovered (derivative exposure has increased, mark to market has been rescinded and US economy is not in growth mode.
Consequently, the vast majority of those in the US as well as the world population, believe the "we are in a slow recovery" story. The MSM has sold this smoke and mirror fantasy by diverting attention to trivial news or reality entertainment stories. The majority of world population are behaving in a a manner which indicates that the current world economic problems can be fixed by the past tried methods of central banking.
Very few truly understand that most of the monetary system is insolvent. The financial elites have reached the end of the book of rules. They know that if they lose control, then the fires of discontent will be unstoppable.
I agree. So what?
dupe
you can't just take the chumps (taxpayers money) or they will get angry. You have to use a pea and three pods...
No, they allocated to the sole benefit of the Party. The Party is everything. Like the Union, nothing can be taken or enforced without the power. Power is political, party is political. The nexus comes together.
Judging by the 4 Kool-Aid drinkers that junked you I'm guessing the answer is yes.
Clearly stimulus spending was insufficient. Redouble efforts!
Excellent suggestion Mr Krugman....what are your thoughts on the stimulative effects of building a bridge to the moon?....you know...to replace the shuttle program...?
T.E.I.N. everyone!
actually now that you mention it it has been suggested that we "build a wire to the moon" and thus forego "all that spacecraft mularkey." basically it would be "the ultimate elevator." look it up--
As I recall, a satellite in geosynchronous orbit could be tethered to the ground and serve as a cheap elevator to orbit. I suggested this to SPECTRE scientists but Goldfinger was only interested in his PMs.
friggin' gold bugs. WHAT DO I PAY YOU PEOPLE FOR?
http://www.youtube.com/watch?v=Bh7bYNAHXxw&feature=player_detailpage
This chart makes it slam-in-your-face obvious that a fascist government cannot properly allocate capital, even when they have a great excuse to do so. Socialism (at least the non-corporate kind) was not tried in this instance (unless you debate that foodstamps and unemployment are anything but price supports for farmers and corporations), so your chart proves zip about that philosophy. Let me know when you see an actual nationalized bank or three, transaction taxes, and money allocated to propping up aggregate demand instead of mark-to-mythsters' "balance" sheets.
Snowball, I hope your family is well? Yen.
"Socialism (at least the non-corporate kind) was not tried in this instance . . ."
Socialism and Fascism are trivial variants of the same deal. Those in power decide who gets resources and money and what they do with it. Both are hideous moral and economic failures. We have tried overweening government power. It fails. Overweening government power of a slightly different form makes no difference at all. The problem is an unchecked bunch of guys with suits and guns who rule.
From the replies, I need to clarify my use of the word socialism. I used socialism (perhaps incorrectly) as an umbrella to describe the act of a government, thru taxation, of taking the citizens property and spending it on things deemed important by the government. Since the stimulus is backstopped by the tax payer, the government stuck a gun into the belly of every tax payer and said "give me your money, I know how to spend it better than you. Trust me, I will use the money to create jobs far better than inefficient capitalism." sine the government cannot asses the true value of goods and services, it was destined to misallocate.
that "socialism" made your house. it also securitized a trillion in credit card receiveables which allowed you to buy that jet ski, motorcycle, land yacht, ocean yacht, trip to tahiti and that hooker you forgot to tell your wife about. (and yes she was worth everrrry greenback.)
Had to junk that vet.
Men wearing kevlar and camo made it possible via maintenance of the Empire.
Regarding the motorcycle and hookers:
Some of us had to actually produce to afford a few luxuries.
women cost too much.
fascinating that you have received 6 junks (presently) for what should be an obvious comment regarding the inefficiency of government decision-making.
Debt Saturation. They borrow, they spend, they print and the massive debt soaks it all up like a giant money sponge.
Thanks for the Stagflation folks. Could have had a sharp and short recession with lower prices. Now? Good luck eating in a couple of years for several years.
Everyone on this site pretty much understands that the Fed is serving as Central Bank to the world's banking system, right? Over $12T was moved during the initial TARP period, most covertly, and mostly outside the borders of this country. That's why the local inflation effects have been delayed, but EE inflation is bordering on revolt levels. Europe is still afloat, (okay, listing badly and stinking to high heaven, but still afloat) and that is a testiment to just how much money was poured by the US Fed into THAT hole.
Given the above, do you seriously think that the American Reinvestment and Recovery Plan was actually anything other than a bone tossed to a dog; a distraction to focus attention for a few needed months? You can't make people wealthy by printing money and distributing it to all. You CAN make a few wealthy by letting them be the conduits for the floods of money, but somebody (a lot of somebodies) at the tail end of the money chain always pays. Seems obvious that TPTB have decided the US is lacking in balance with the rest of the world, and over time we'll be brought down as others are inflated up.
QE2 was a success in that it staved off the inevitable collapse for a while longer, allowed many connected friendly parties to bail out of their Treasury holdings at par, rather than zero, gave lovely profits to the Primary Dealer intermediaries, and has funded yet one more year of a 1:1 deficit to income (corrected from GDP) spending binge. QE2 wasn't about jobs.
Good riff...
SWcroaker:"Everyone on this site pretty much understands that the Fed is serving as Central Bank to the world's banking system, right? Over $12T was moved during the initial TARP period, most covertly, and mostly outside the borders of this country. "
>>>>>>>>>......
thanks for writing that, strange how many posts followed without much comment on the trillions of FRN's moved off shore..why would that stimulus help JOBS in USA?? of course it would not.
Not only has the "policy" been to off shore manufacturing and jobs, it seems that the" policy " (hidden from public and never refered to even here of ZH only a few times) ..was to off shore the recovery...remember when the fed refused to disclose where the money went even to congress!! thank god for that man who forced them to reveal this info even if it took years and happened after his death. HE should be an icon on ZH. Thank you Mark Pittman. rest in peace.
Hope this article for those few on ZH that don't have a clue.
Will they ever?
Some people just gotta learn the hard way.
at least w used to send out checks to everyone. obummer just gives it to the uaw and the bernank gives it to jamie dimon.
if congress hadn't given the privately owned FED the monopolistic franchise to create U.S. currency... the gov't could have sent each household some currency and the stimulus would have "worked".
fear not, debt-money is fubar.
Yes buzz! YES!
If you actually accepted one of those checks you would know that the bill for it came on your very next tax filing. That was Just W's way of tricking people into spending money they didn't have. O skips the middleman (taxpayer) and hands the money directly to the banks. Not much different.
So, is QE2 really gonna peter out?
What a Weiner attempt....at destroying the eCONomy, but time will tell.
the logic is simple. imo they cannot let the long end run wild. many "bad things" happen to bank balance sheets if that happens. disclosure: way out on the long end and loving every minute of it.
The long bonds should be great fun when the dollar goes to shit within months.
I'm absolutely banking on it.
http://www.youtube.com/watch?v=I1wg1DNHbNU
+++++++++++++++++++++++++++++++++
yeah that was a time machine.. and it was great! Thanks Bro!
How fascinating. Thanks.
http://www.youtube.com/watch?v=xNnAvTTaJjM&feature=related
What happened to all of those green shoots that all the experts were seeing a while back?
Twenty years of fiscal and monetary stimulus has done nothing for Japan (other than building up a massive pile of debt that will eventually blow up in their faces). Why are we doing exactly the same thing here?
But, but, but .... Look for a huge washout in silver soon ....
(Reuters) Tue Jun 7, 2011 10:40am EDT - The U.S. Federal Reserve will begin a series of small-scale reverse repurchase agreements on Wednesday in preparation for the eventual possibility of withdrawing liquidity from the monetary system, the New York Fed said on its website on Tuesday.
The first of the reverse repurchase agreements on Wednesday will involve only the expanded repo counterparties announced on May 23, while a second set of operations will be open to all eligible reverse repo counterparties, the New York Fed said.
The New York Fed on May 23 added 32 new money market funds to its roster of counterparties it could eventually tap to drain cash from the financial system.
On May 24, the New York Fed laid out the criteria for Fannie Mae (FNMA.OB), Freddie Mac (FMCC.OB) and other government-sponsored entities, or GSEs, to become counterparties it could tap to help drain the $1.5 trillion in excess reserves from the banking system.
Reverse repos are one of the tools that the Fed has said it can use to tighten monetary policy when needed to help prevent inflation.
http://www.reuters.com/article/2011/06/07/markets-fed-operations-idUSN07...
I wouldn't mind a nice PM buying opportunity.
You left off the best part (from bloomie):
In a tri-party arrangement, a third party functions as the agent for the transaction and holds the security as collateral. JPMorgan Chase & Co. and Bank of New York Mellon Corp. are the only banks that serve in a trade-clearing capacity in the tri- party repo market...
* ..in preperation for the eventual possibility.. *
so the fed is going to buy more worthless bullshit for a little while then sell it back for more?
or are they going to buy them then wipe the price clean and give it back? is this just more free money for banks?
how in the fuck will this draw back liquidity?
i'm trying to understand, but i feel like i'm missing your point here.
Romer, Ghoulsbee, Bernanke, Greenscum, Paulson, Geithner, Summers... all must be tried for treason. When found guilty they must be fed to the
Nile crocodiles at the Washington DC or Bronx Zoos. Video must be taken and every anniversary day for the next 50 years every school child from 1st to 12th grade must be made to watch it.
That stimulus money does seem to have gone into a deep black hole somewhere, I do remember a few road signs and singns put up in parks that credited the Recovery and Reinvestment Act for some public works projects they were going to do, but then those mostly came down and I could not see that anything had been done. I think in the rush to get the money out they just distributed it to the states for use on "shovel ready" projects but there were enough loopholes that the states just used it to delay facing the music on their own debt issues for another year or two. One thing is for sure here, not one job in this county was created with it.
31,000 Illinois highway construction workers will be laid off starting June 17.......with an anticipated 21,000 more................3000 philly schoool teachers get pink slips.............thanks ben........
http://www.chicagobusiness.com/article/20110606/NEWS02/110609868/illinois-highway-construction-halt-means-31-000-layoffs
That's because what's not sitting on the bank's balance sheet to cover their ass because of the housing market, was spent on one time government funded projects. Despite what the government thinks, the market is not fucking stupid. The market actually realizes that it is one-time money. You don't hire, you don't ramp up inventory, you don't build new factories just because the government wrote you a one-time check.
Stupid fucking economists thought that there was a multiplier in the money the government handed out. Hey dumbasses, just because I win a hundred bucks on a lottery scratch-off doesn't mean I change my lifestyle in anticipation of ongoing revenue from the lottery.
Where's my PhD? I want on the Fed.
It's my understanding that most of these "shovel-ready" projects were states "shoveling" the FRNs into insolvent public-employee pension funds.
ramping up "just in time for the re-elect." could be inflationary.
Proposal to close huge redwood park has state, federal officials concerned
Officials are researching how they can keep California’s fifth-largest park open after the state proposed closing it to save money.
State and national park officials met Friday to begin sorting out how much of Del Norte Coast Redwood State Park they can afford to keep open.
“Our goal is that by the end of September we will have options decided on by our partner,” said Jeff Bomke, Redwoods State Park superintendent.
If a remedy is not found, Mill Creek Campground could indefinitely close after Labor Day weekend, and the park’s trails and watershed would follow in July 2012. http://www.triplicate.com/20110606112220/News/Local-News/Whats-at-stake
++++++++++++++++++++++++++++++++++++++++++++++++++++++
There is more if you are interested, the point is that this is not some run of the mill woodsy area like thousands of others around the country, it is one of the rarest ecosystems in the world, people come from every nation to see these forests, and even if they close every park in California it will be a fraction of one percent of the annual debt accumulating.
Common sense says look at the budget, what are the 10 largest items, why are they so big? Cut them. In most (all?) states education is number one and healthcare is number two. Education is an utter failure and would be at twice the cost, there is no discipline, students sleep or text message each other during classes, bullying and chaos reign. You can double the budgets yet again and the punks with pants around their knees will still be just as ignorant. Do I have to point out the obvious solutions? We are all adults so I should not, but try school uniforms worn properly, try leaving all iPods, phones, and other communications devices at the door, try kicking the bastards out when they cause disruptions, and flunk their asses when they fail to meet goals. CUT administration.
Healthcare? Thornier but we can start by deporting undocumented people because it is either deport or support. Mind you I am (was) a democrat and the son of an immigrant, but he was admitted legally and died neither rich nor poor, but the state never paid a dime toward my healthcare.
There is a lot we can do to balance the budgets, better taxation (NO LOOPHOLES) but without cutting into the bone of all other programs and decent projects. Closure of our crown jewel parks will result in their being stripped by poachers. That is just one example.
But then again, the mess is now so large and so unsolvable that all possible fixes will have to wait till after collapse and bankruptcy. I have been saying for 20 years private for obscene profit healthcare would bankrupt the nation, it has. You can't remove 2 trillion a year from productive pursuits and channel into healthcare without it eventually destroying the economy.
it definitely makes more sense to destroy the world you live in then to create a disciplined culture of people who live within their means, right?
Please clarify, how does one "poach" a 350ft-tall Redwood tree (average diameter: 25ft)??
people setting up coca or marijuana plantations on the hills, herds being depleted and destroyed because food prices are high?
if there is no protection it would be relatively easy to drop in with modern machinery and grab some old growth, forestry is pretty advanced at this point.. if the moneys there for the luxury of a personal lodge made with solid redwood beams..
Total and complete failure...OH and all we got to show for it is a lousy extra $27 trillion in debt.
So now its failing again, so what to do? HEY I know, lets do the same thing all over again!
MR Market is a Frankenstein monster with a $7 billion a day crack habit that con no longer be paid for, this murderous rampage Mr Market goes on next will be very ugly.
You miss your "Mr Pig Market" T-shirt?
Schucks, only have 4.
great imagery...give me $7 billion or i kill everyone!
$7 billion is too low - it's like Dr. Evil asking for a mere $1 million
$7 billion, a DAY!
:D
You didn't get your 'The government ran up $27 trillion in debt and all I got was this lousy t-shirt' t-shirt?
I got one, but its one of those cheap ass beefy-t's that fall apart after you wash it twise.
Could we possibly have done worse with Paris Hilton as "Chair of the Council of Economic Advisers"? At least Paris would have been easier to look at ...
...and make better vids :)
QE 2 was successful in reducing the amount of interest paid by the US by suppressing interest rates. This reduced the growth of the deficit.
Deficits don't matter, remember?
Right, who was that wonderful vice president who gave us that sage advice?
Uh, Plugs? 5 months ago? Always plagiarizing, that guy...
No other side-effects you can think of?
Purchasing power?
Herding to risk?
The deficit is still growing quite well despite their 'valiant efforts'.
Yes, but the rate of growth of the deficit is slower thanks to QE2.
In a perverse way, hilarious!
DavidC
They filled the black hole of the shadow banking blowtorching™
Now get ready for liftoff
Ground Control to uncle ben
Ground Control to uncle ben
Take your pomo pills and go home it worked
Ground Control to uncle ben
Commencing countdown, engines on
Check ignition and may the primary bankers love be with you
Ten, Nine, Eight, Seven, Six, Five,
Four, Three, Two, One, Liftoff
This is Ground Control to uncle ben
You've really made a nice put
And the papers want to know whose shirts you wear, versace ?
Now it's time to leave the capsule if you dare
"This is uncle ben to Ground Control
I'm stepping on the dance floor with dimon and pandit
And I'm moonwalking in a most peculiar way
Ben Bernanke firing up the printing press to warp speed, cranking out billions in free money to the big banks, is not only causing oil and other commodity prices to rocket to the moon, but it’s also causing the stock market to break loose from all things that are real and growth producing about our economy, where it’s now living in its own little bubble world, just one needle prick away from going pop!
Ground Control to Major Tom
Your circuit’s dead, there’s something wrong
Can you hear me, Major Tom?
Can you hear me, Major Tom?
Can you hear me, Major Tom?
Can you….
http://www.youtube.com/watch?v=J9fkYQ6pPeU&feature=related
Jamie Dimon gripes to uncle ben....
http://money.cnn.com/2011/06/07/news/economy/jamie_dimon_bernanke_dodd_frank/?section=money_latest
http://www.youtube.com/watch?v=bmmnmSBvGX8