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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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"Fear the Boom and Bust" a Hayek vs. Keynes Rap Anthem
http://www.youtube.com/watch?v=XoWdYYKdbLI
http://www.youtube.com/watch?v=VHkNPa7FveA&feature=related
http://www.youtube.com/watch?v=EYEbAyc5oFo&feature=related
http://www.youtube.com/watch?v=LcKJdmXbBBc
http://www.youtube.com/watch?v=jGQJ1_6WAMM&feature=related
http://www.youtube.com/watch?v=4k_71znxOoE
http://www.youtube.com/watch?v=2HzsXbDd-sA
http://www.youtube.com/watch?v=IE3KdcTgrno
What is really most astounding about the chart is that in both assumptions there is the fixed belief that things will get better. There is, of course, no assurance that things will always get better. Japan has proven that you can wallow in economic doldrums for a generation. Other countries have demonstrated that it is possible to have net economic regression for sustained periods of time. There is so much idiocy out there and a big probllem we have is that much of it is taken as a given - even if you wish to take a realistic look at things you are prohibited by the terms of debate from so doing.
A great example of this is right here in my State of Nevada. We just passed our bi-ennial budget. There is one, small miracle in it - we will actually spend a little less this next two years than we did the last. But even with that, we only managed to balance the budget because at nearly the last minute a group of "experts" came in with a new prediction and, gosh darn it, wouldn't you know that they suddenly decided that revenues will grow much faster than thought! By hundreds of millions of dollars! No need for more spending cuts, as the Republicans wanted but wereafraid to impose. No need for more tax hikes, which the Democrats wanted but were afraid to impose. No worries, at all - the Miracle Money Machine went to work and, presto!, there was just enough to prevent further cuts to higher education and higher taxes on mining. A real miracle, huh?
So, next year when revenues don't come in as projected, we'll be back at it, again. But no one was allowed, it would seem, to point out that even if the new projection turned out right, we would be irresponsible for banking on it - better to go lowball and if we wound up with more than we needed, cool. No, we were all required to be stupid based upon an expert assumption that with 12% unemployment and 66% of houses underwater that we're going to have an economic recovery...just "because", I guess. Economies always recover, don't they?
Say, how many of you out there are planning to blow a couple weeks pay in Vegas over the next year? We really are kinda counting on you...
Cut all funding to 'higher education'. Let the Dufi buy their own drugs. God knows, you in NV have a ton coming in with all those illegals.
Zetas, baby!
Ooooo, and Reid rules!
Vegas - what a cheesy cesspool of degenerates. Good luck.
I beg your pardon but we are not a cesspool...
R 2, you have Reid.
Well then they are definitely not cheesy.
Thinking about it.
$1000 per every man, woman, and child is "only" $320B. They gave trillions to someone but it sure the hell wasn't anyone I know.
The people you know are getting something, alright.... the bill!
Monetary policy is geared towards enriching Wall Street, while fiscal policy is geared towards enriching Main Street. And since most jobs are created on Main Street, fiscal policy should be the drug on choice to combat unemployment.
This is why I'm not a big believer in using monetary policy to combat unemployment, especially when unemployment becomes as steep and as prolonged as it is today. But I am a big believer in using psychedelic rock to combat insanity, even if it causes you to become Comfortably Numb:
http://www.youtube.com/watch?v=JWnapx502uQ&feature=related
still no dividends for Uncle Moneybags. "He's returning the favor" no doubt but "Bernanke's gotten lucky" with Fukushima and "The country now known as Grease." As far as rock 'n roll monetary policy i'm more of a "Runnin' Down the Dream" man myself
http://www.youtube.com/watch?v=c5tF_-AkU6U&feature=player_detailpage
Was the original projection of what would happen to employment wrong? Clearly yes.
Did the stimulus program increase unemployment? That would be the implication of this article. That implication makes little sense.
Had the administration raised taxes to fund the stimulus, then one could argue that action caused higher unemployment. Taxes were not raised.
The administration borrowed to finance the stimulus. Is there any argument that that borrowing caused higher unemployment? The borrowing did not result in an increase in interest rates. Businesses are sitting on trillions in cash. The stimulus plan did not increase the cost of doing business nor did it divert money that otherwise would have been used to create jobs.
Unemployment would have been higher but for the stimulus.
The economists failed to estimate the reluctance of business to create employment. In normal recessions that would have happened by now. It has not.
Blaming current problems - the current reluctance of business to create jobs - on a one time action 18 months ago makes little sense. However, it relieves one of the necessity of trying to find another reason for that failure of business to create jobs. Of trying to answer the question - If business won't create jobs what should the government do?
a) nothing
b) stimulate again
c) find ways of forcing business to create jobs
d) all of the above.
How would you force business to create jobs?
How? Stick all Libs in the FEMA camps. Problem solved.
You would accomplish more by raising taxes on thinking republicans, both of them.
Businesses are reluctant to create jobs because they know that they cannot trust the prices signalled by the market, because those prices are manipulated by government intervention.
The correct response to your question is: none of the above; instead, quit meddling in the economy and let price signals allow businesspeople to determine how to deploy capital in a productive way, which will in turn spur employment.
Business is reluctant to create jobs because Libs exist.
What part of that don't you get?
"Did the stimulus program increase unemployment? That would be the implication of this article. That implication makes little sense." Wrong. I don't see that implication. Both original lines were projections with the actuals drawn in. Because the actual with stimulus was greater than the projection without, I wouldn't jump to the conclusion that the author is implying what you are accusing him of implying. Anyone else agree?
What a simple world you live in.
How would you force business to create jobs?
By the very question you reveal absurdity. Perhaps a good place to start would be Altas Shrugged, I reject the idea that you have standing to even ask such a question.
sschu
for real, bizzarre assertion, the same as saying; how do you force someone to work for less.
atlas shrugged is kind of long, maybe: http://en.wikipedia.org/wiki/Fountainhead ?
If QE2 is a disaster and I agree it is. Where does that leave the president of the United States. My guess would be a one termer like Carter. Anyone would have to admit if you're running this country with any degree of vision you would have to conclude that the Treasury Secretary and Federal Reserve chair need to be removed. Why no changes?
Why no changes? Because they are doing exactly what the bankers want. Simple.
Bingo....give that man a prize!!! It's much more likely that Bernanke would have Obama fired. The fact that so many people on this site still don't get this shit is just amazing to me!
T.E.I.N. everyone!
Hey, we don't want markets and the invisible hand making decisions here and doling out consequences.
Only central planners who have never grown as much as an avocado in a cup know what crops to plant 2,000 kilometers away from the capital.
Failure of QE2 is the gold bug's ultimate nightmare.
Once the booze is pulled from the party, everything that has "risk" associated with it will go down in flames.
And gold is "Risk Item No. 1".
As I said all along, the CIGA's should have been cheering for QE4, QE5, QE6, more government spending, more intervention into the ES futures market, Dow 15,000 etc.
What currency are you valuing Gold in, RT?
In US Dollar only, bro. Commodities are priced in $USD.
Who cares about Swiss? We can bomb them and take over their banks
and Rolex factory, that's about all they have..
Ohh, shooot, sorry, I forgot Roger Federer.. :)
Try buying Au in die Schweiz with $.
Try buying anything in Switzerland with USD, a 2nd class bus ticket from the suburbs to downtown and back can easily be over $25.
A first class lunch for two at a hotel can easily run over $500, before the wine.
PPP coupled with a strong CHF vs a weak USD
Greeny, have you heard the expression -- You are a Baffoon!!!
"You are a Baffoon!!!"
So? Is that bad? Live is too short, if you
going to be too serious about it..
Well, before you sticking labels let's see how it's all turned out,
OK? Even Buffoon could be right against ANALyst..
Ohh, and by the way "Baffoon" is actually (misspelled) Buffoon,
too much for Spelling lessons, bud.. I Gotcha!!! *LOL* +1
Ones you return from Argentina I'll let you count my Silver Bricks
in my basement for fair salary.. Hope you better in Math :)))
Greeny, it's futile. Don't waste your time. YEN
anal wanderer just seems to fuck with people without providing substance. I haven't seen anything that goes beyond basic insults yet..
Exactly.
Gamba Robo (his distant Zimbabwean cousin) would have gladly traded a few trillion paper tickets for an ounce when bread was going for a million paper tickets a few years back ;-)
Absolutely
+1
Shows you guys SO dont get it at all. What are you pricing PM's in Robo? Dollars? LMAO
What are you pricing your stocks in? Definitely dollars, which are going to shit.
QE (x) is off the table until the debt ceiling is raised.
And they cant raise the debt ceiling, they have this little problem called bankruptcy and no ability to borrow from anyone. Next up, WW3.
Of course they'll raise the debt ceiling. As Tyler mentioned yesterday and I alluded to as well, now that the government spent the retirement money of the federal government employees, raising the debt ceiling has taken on a whole new purpose and urgency. If you are a govt employee whose pension was spent, are you going to vote for a guy that voted against reimbursing the retirement funds?
Need a pissed-off goobermint contingent to riot first.
they'd be rioting except for that c- in remedial fractions.
i was robbed once, and reported it to the clerk, i told her that i had been taken for some euros as well as dollars, her response was "we don't use euro's here, so i'm not gonna put that down", I had to explain to her that euros were money, and that i could exchange them for dollars to get her to list it in her report.. fine police work their lou(anna)..
Let's go back to the US History:
=====
1) First time Credit Ceiling was established in 1917 and
was equal to $11.5 Billion.
2) First time Debt Ceiling was breached in March 1962
Since then US Debt Ceiling was increase 74!! times
=======
sourse utro.ru (translated)
======
What makes you think that they will not rise Debt ceiling in
75-76-77 time and so on???
This is just a baby game between Dems and Reps, everyone
already know the output..
And YES!!! 2012 is US President Election Year and DOW should
and will rise significantly...
Ceiling will be raised soon and after a while QE3 just in time for
2012 ELECTION Campaign to make PIGS flying with the nice
leap stick on their faces..
Let's see.....
they should just pull another false flag and raise the ceiling significantly, citing the need to fight the threat. Since they killed off Osman, they'd need to create a new Emmanuel Goldstein—and this son of a bitch has to be loyal as hell, because he's going to have to play the part to allow for a virtually "unreachable" debt ceiling—and we'll reach it in 40 years, anyway.
I figure they're (cia, and whoever else cooks up this shit) probably planning on putting a few major american cities on the nuclear chopping block. What's a hundred million people when you'd get access to anything the hell you want?
Presto!!! War it is officer nasty! Hey, General Doofy, start kicking Pakistan in the sack and tell India it's go time!! Let's see how China likes this if they are not going to keep buying our debt. BTW.....don't forget to keep squeezing China out of it's oil markets and slap the hackers! No sleeping on the job hack misters! NUKES or Bust!!!
When you say gold bug's ultimate nightmare, are you referring to gold as an ETF or mining stock? or are you saying gold like coins I have buried in my neighbours back field?
That's silly. The cheaper gold is the better. More time to convert to real assets, and at better rates.
For a time, until the election nears and stocks need pumping again so all those boomers don't get bad news in their paper "retirement" accounts.
It's possible TPTB will want to get Obama out and a Repub in to make the old gaurd feel as though they can save the already dead republic by using "austerity" (translation: can kicking).
Depends on how many soldiers they need from the ghettos and po' folk and their demographic analysis of graduating seniors of color and morale amongst the deluded officer corps.
I hate to remind you once again Robo, but QE came much later into this Golden Bull run. Started in 2001 and QE came 7 years later in 2008 and then QE II again last year. How do you explain this fact away?
You have no idea what you're talking about you pathetic assclown.
Interest rates near zero for infinity is bearish for gold. Cheap money is a sign of fiat strength. After all taking the debtor's word is enough for me and is the collateral of kings.
OH CRAP? Maybe I should have bought gold. Na.......I'll wing it.
The failure of QE2 makes QE3,4,5... inevitable.The politicans are like those WWI generals who kept ordering bigger and bloodier infantry charges against entrenched machine gun positions.
It is certainly possible that PMs might slump temporarily if there is a big selloff in the period between QE2 and QE3. If so, I'll load up on them.
It seems so bizarre to me that Treasuries are considered "safe" when we all know that the US gov can never repay them.
Duplicate post deleted ...
RobotTrader
"Once the booze is pulled from the party, everything that has "risk" associated with it will go down in flames.
And gold is "Risk Item No. 1".
Dang, it's good to see someone on here that has half a brain. So true! I do own PM's, actually more than 99% of the folks on here but I'm afraid that my (our) party is coming to an end soon as austerity will have to become reality. When it does, good by risk on trade and yes, PM's are publich enimy #1.
Get ready to hedge up bitchez.
Is that you Tejas Slinger?
No doubt...
"...good to see someone on here that has half a brain"
Just half? I'd give him more credit than that... But you found him, and you know what they say about like minds...
Austerity is for nations under the control of a foreign printing press. Its not for us. You inflate until you can't... Everything in between is noise or hollywood production.
$35 in 1971....$1544.4 @ 20:44 7 June.
Just b/c 3 has not happened yet does not mean it will be avoided. As a function of time...3 will come quicker than 2.
yet the part time, contract 1099 processor still owns monster boxes of silver eagles and an ira full of gold stocks, according to his own posts. so if he really believed his own words he would have sold said silver and gold stocks. but he hasn't. ditto for shorting the market as he told everybody within listening distance that if 1300 broke he would short with both hands, which of course he didn't.
so for the umpteenth time at zh the 1099 processor lies to himself about what he posts and what he actually does.
he never replies to replies to his post, meaning a good chance he is attempting to mine opinion.
I rarely respond to my own posts, but I'm a solipsist.
(up to you to determine the sincerity of this)
Went to Atlanta today to see Bernanke.......
http://chippewapartners.blogspot.com/index.html
Thank you Zerohedge.
There is no ill wind that does not yield some good to someone.
The tricks theBernank and Paulson pulled under strict orders from their Marionette Masters at Goldman Sucks, from Lord Blankfein and Bobby Rubin, did precisely what they wanted it to do.
Why do you ignore this?
When people are handed fat sacks stuffed full of billions of free $dollars, they do stupid things and dont think too clearly. Never ignore this.
"QE 2 Was A Disaster"
Well, every working US person got 401k.. QE2 was success for
Equity Markets at least. Uncle Sam getting 30% taxes on your
gains and careless about your losses. Even artificially
boosting Equity Markets Uncle Sam getting more interest
then from low paying dudes, which are mostly TAX free.
Don't f*g tell me, after waiting
for like 7-10 years you not enjoying Silver run to $50/oz?
You want to see $10/oz price print on Comex again?
Don't wake up the Bear, he is sleeping at least for now..
Uncle Ben can get mad.. Do I hear QE3???? Yeah, baby!
Greeny,
I told you the other day to practice your English. Most folks stopped using hieroglyphics long ago.
My English is fine, you just don't get it, that's the problem..
Perhaps you are too old, or too lazy, or both.. I hope you
buy enough barbed wire to secure your Argentina farm house,
buy few machine guns as well.. When things will (If) get ugly
in USA, - in those third-party countries you going to be
a fresh meat for those local gangsters.. Be prepared.
Nice use of white space.
Start each line anew with a sentence and a capital letter.
It will emphasize each thought and its face.
It may make your detractors feel better.
It will appear as each post is a fine stanza.
Coming straight from your personal, beef strewn, Bonanza.
Dude, white easier to read, nothing else.
Saving your eyes.
Exactly.
I like it, keep up the good work and words.
Thank You.
Greeny, it could turn-out to be the same here, but maybe even more risky if in a major city when the tables turn.
CUMING from URANUS? LMAO!
\
That explains your lack of thought. Still scribbling on stone, with camel spit?
LOL Greeny wait till they seize everyones 401K's next upon market collapse!
There will be no QE3 thats all a dream, we're bankrupt, fini, kaput.
But all this printing didn't bring back the factories and the jobs gone, and didn't lower debt, and didn't stop speculators or greed or increase of foodstamps.
And neither will QE3.
QE1-QE3 is just cosmetics and buying time - for a thin majority.
And by the time QE3 comes things will be a lot worse - because all sorts of paper, including trust in paper, except dollars and treasuries will be lower. And as was QE and QE2 - QE3 will be nothing but a temporary dead cat bounce.
This is a matter of factories and jobs. And these will not come back before the Euro and the Dollar have lost 30-50% - or there are other reasons to come back.
Now (with Goulsby leaving) all the academic pinheads who never made a payroll, who in fact never went without a check themselves so they could make employee payroll, who never actually ran any business in their life in order to employ anyone, will be gone.
Back to teaching Keynes' over hyped theory as tenured college professors...the damage they are still capable of doing to the future is immeasurable.
Hence stick 'em all in FEMA camps: no cell phones, no Internet, they all be dead in 6 days.
Goolsby isnt going back to teaching, he's getting a headstart going to his deep underground bunker.
They make an app for that ;-)
One for the money...two for the show...LOL.
Duplicate...runnin slow here.
+61.3T unfunded kudos.
Use 2 windows.
LOL...I got six running now.
Got a "retry error"...shouldn't have hit it...but hey! we're at day 769 without a federal budget!
Accidents happen ;-)
"bugets don't matter" - some Lib yet to be diselected
Hiding from Ellie.
That was the ultimate oxymoron! Nice work!
1) Banks are sitting on cash....
2) Companies are sitting on cash ....
3) Markets are now allowed to extract money from the real economy at CPU speeds
4) ... unfortunately that cash should be in the pocket of their customers, who on the other hand are sitting on debt ...
Somebody could say let's fix 4) ... nope .... .....
Wrong 'bets' in the market .... save banks and big time investors
Real Estate Mortgage troubles ... let's give money to the banks so consumers can get more debt to pay/add to their failing mortgages
National companies at a disadvantage in the international contest .... more money to banks for commercial loans that companies do not need, and more money for speculators for no real investment, but only for pure speculation...
Yep ... Geniuses are in control! And if you doubt it, just look at the implication of Dimon's question to Bernanke: Stop regulating us!! Leave us alone!
That's it! We got the solution ... thanks Dimon!
So funny, their ONLY solution has been 'hand us more free money'.
Like this?
http://www.rollingstone.com/politics/news/the-real-housewives-of-wall-st...
From that article:
We have a winner!!
Again, you're an idiot. I get it, let's get to a zero margin society, yeah, that's a great start...
get an education.
why should banks that maliciously misallocated capital be handed free profits? drop some wisdom on me tater salad.
most of that money, the big corporations are sitting on, is borrowed.
You are an idiot aren't you. Yes, let's give money to the idiots (like you) that levered up at 5 X earnings and then some so me and the rest of the 2% crowd can pay the tax bill to bail your broke dick out.
Brilliant!
hey, you're that guy who voted for obama, right?
A modest but perhaps effective proposel from Randal Wray
www.youtube.com/watch?v=TVMaQmDSi9Y
Congress ain't going to touch it however - not their style
The dork needs to be introduced to a razor. He's right, but does he think he's Dr. House?
Yes Mynhair , I am familiar with all the isms that can afflict the body politic
www.youtube.com/watch?v=To3CFnoOUDI
Update: the turkey went off the rails 14 minutes in.
Got me, Dork!
that's why they make walls...and guns!!!
Line 'em up...
If $700 billion went to the banksters, where would you think the $787 billion would go to?
Is this a trick ? ?
SEIU, of course.
Bring Volker back. He solved the problem before and could again.
It's not that simple any longer ...
The speculation (intended as wealth extraction with no connection to the real economy) that was used in the past to the advantage of the USA, is now the very instrument that is destroying the nation....
In the way the market(s) and investment banks function nowadays, fundamentals are irrelevant, companies' worth is irrelevant ... there is no allegiance ... there is no other logic but the algos'
Any real solution would need to be global in nature ... good luck there .... lots of nations just waiting for the fall of the empire ....
Volker was their man for that season. So was Greenspan and so is Bernanke. They are there to do what is asked of them. That this fiat system has to fail is a known fact. The thing is to ensure that when the collapse comes they should be holding the purse strings and we are to be on puppet strings.
They have been kicking the can down the road for an event in the immediate future. The problems are too big to be resolved. Have you noticed no action has been taken against anyone involved in the financial collapse and frauds.
We need at least Ten Trillion more for any dent in this deflationary spiral.
At least my Property Taxes are going down.
no in New Jersey and that doesnt even count for the $120 BILLION in pension and health deficit for public leeches
At least my Property Taxes are going down.
In what state? Texas? Are you being sarcastic?
NJ's property taxes are only going up as Christie has to deal with years of fiscal mismanagement by the past few governors.
property taxes where i'm at are going up while assessed value is dropping.. they have a helpful website you can go to to help you understand why this makes sense.
To me, the thing that stands out about Tyler's superimposed chart is how accurately they unintetionally predicted unemployment rates, since logically, the job market received "no stimulus."
I didn't know they had it in them.
The employment condition was not intended to improve. Somehow, mass consumer debt defaults and continued decimation of the status for those who rely on a paycheck was apparently the goal.
Bend your mind around this:
June 7, 2011
tags: bankers, Co-inspire, Credulity, instinct, switzerland
by anadianant
http://aadivaahan.wordpress.com/2011/06/07/bend-your-mind-around-this/
.
Startling revelations from a Swiss banking insider
http://noviden.info/article_239.html
.
Startling?!?
.... not at all ... that is just Marxist propaganda .... spread by trolls who want to impose socialist policies on all of us ...
in fact the current economic crysis is the resut of said socialist policies and over-regulation of capital markets!
Stop spreading this type of baseless disinformation! Now!
Greed is beautiful ... greed is the essence of life ... and were it to be bad, it does not exist!
Wrong! It was all a plot. Dig deeper to know the truth...
and please release yourself from this red good/blue bad stuff. Did you even read it? Do you know the history?
You should study more. Seriously.
________
P.S. Your check is in the mail!
;)
Sarcasm, people.... sarcasm!!
I did not junk you, or any one else. I'm laughing though! YEN.
'Over-regulation of capital markets caused our current economic crisis?' What are you smoking? Deriatives and lack of regulation almost whipped out our modern banking system. The same ones that are ramping up again to cause another economic crisis with socialist policies (debt) being another cause.
Are you saying the our modern banking system was too modern?
By the way ... what the fuck are deriatives?!
And when you say whipped ... are you talking cooking, horseback riding, or sex?
C'mon guys ... don't junk me ...
He started it when he spelled check crisis for me. I'm just returning the favor!
:-)
Yeah, you got me misspelling words too.
I like you ... though!
In the "conspiracy game" it's not so much about what one can say, but what one can prove.
Of the $787MMM, about $288MMM was tax cuts.
and/or:
A paltry .275 tril was never going to fix the jobs picture. The Fucking charts were lies from the get go and any of us awake back in 09 new it.
Most of those $224 billion went to states to prevent a disaster (in terms of layoffs) that was only postponed. The hope was that delaying layoffs would allow people to remain engaged in the economy as the recovery was to begin ....
That stuff worked when nations still had control of their faith ....
Not any longer ......global bitchez!!!
I don't think it was a lack of faith that prevented the recovery. Have you ever seen the country's monthly/yearly trade deficits? If I were in China, I would be still be pretty bullish.
This person is apparently a troll of the first order, i.e., fresh out of troll school.
Tag another one.
Yeah, I suspected that when he didn't spell crisis correctly above. Thanks for confirming it.
I suspect a crisis, lets confirm? BOBBY!?
Vernacular educate?
Really?
:-)
And where did I mention lack of faith exactly!
"That stuff worked when nations still had control of their faith ...."
Inferred..
Wrong .... there is no lack of faith, to be sure ...
What I am saying, not inferring, is that the global game is on and nations are now pawns on the worlwide checkerboard.
ahhhh! "so Captain America said keep the checks flowing." now we're talking: "what does the Federal Government do exactly again?" Answer that simple question ever so simply and I think it goes a long way towards explaining how it can sustain trillion dollar deficits. "it doesn't bail out banks" is clearly correct answer numero uno.
Upon our birth, we are seen as economic units of the Federal Reserve and IRS. We shall grow up, become educated and figure out how we are exactly going to earn notes issued by the Federal Reserve. We are supposed to be productive and learn how to efficiently earn them, while at the same time giving a portion of those earned federal reserve notes back to the Federal Reserve's sister agency, the Internal Revenue Service. Those notes will be used for the general operations of the US government. Amongst those activites are warfaring and welfaring, as well as creating a very secure and "watchful" village for us to live. We are to be good and humble children for the Fatherland. If the US government along with the Federal Reserve decides to inflate and stimulate by injecting more Federal Reserve notes into the total supply of notes, than we should accept and go along with this activity in the spirit of recovery. We shouldn't resist. No, no... If we resist, then maybe we're not patriotic. Maybe something worse. Like a terrorist, or even an enemy of the state! We should not buy gold or silver, especially now because the UN said that they're a bubble. The UN also said that the government should help us make investment decisions. Oh I'm so excited! Enjoy!
As anyone, who has ever build something in the physical world will tell you, making something to work AS expected is HARD.
Generraly making power points is ... well let say, waste of electrical power ( exceptions are always possible ). Listening to the brainless politicians/economists/bankers is waste of OUR time but not to theirs, they are being payed to do that: seal steal steal ...
Fuk it, I'm going long Weiners.
The business networks seemed to have had guest speakers who are bullish on the American economy on their shows right after Bernanke spoke. These people want the regular sheeple to keep spending and pretend everything is great after reporting last week's jobs numbers. It truly is sickening to listen to these people say that in the second half of the year, the economy is going to strengthen. They are trying to sucker people into keep spending like we aren't entering a double dip, even though we are.
When it appears obvious that hiring will slow and layoffs will start again (most likely already have), how dumb do these bastards think we are to suggest we keep spending? They slaughtered the American middle class (which was the backbone of our economy) and now think we will trust them enough to listen to them while they blatantly tell us lies. If you haven't all ready figured it out, do not spend like there is no chance you may get laid off, because there is pretty much a 100% chance of an economic slowdown (and don't give me any of that 'self fulfilling prophecy' bullshit either.
That being said most regular posters on this site knew the recovery was horseshit.
Then, to add insult to injury, they are blaming the whole thing on the middle class ...
How great would it be to go rob somebody, only to turn around and tell them that, if they need money, you have a nice part-time job for them, with no benefits, and shitty pay, ... oh, by the way, ... they can forget about vacation days!!
Bobby, isn't Z/H a business forum? Or does Bobby need a room full of constituents to feel EMPOWERED!?
Reminds me of something I heard on the radio yesterday. One of the local talk radio people, let's call him Dog Burgan, was talking about how this month's employment numbers were mostly due to McDonalds. He said that, if he found himself unemployed, he wouldn't take a minimum wage job either. Great, except that he's spent the last year either ridiculing the unemployed as lazy and stupid or bemoaning how the evil minimum wage is too high and destroys jobs. If we could just find a way to harness hypocrisy, PA wouldn't need to drill for natural gas...
Ladies and gents....like a keystone (A keystone is the wedge-shaped stone piece at the apex of a masonry vault or arch, which is the final piece placed during construction and locks all the stones into position, allowing the arch to bear weight), positive , real interest rates hold together the socio-economic principles of a capitalist society.
A positive real interest rate is the only policy that will return the US to economic health.
That's what Volcker did, albeit heavy handedly because he had to given Carter's completely socialist type spending policies, and inept economic programs.
What is the probability of the Fed approaching a positive real interest rate presently?
Exactly....this end game is going to be much more nasty than a 1 year recession resulting from a positive real int policy.
Making it more costly to borrow money would achieve the goal of helping the housing market bottom within months, but it would not make me want to borrow money, or any business owner for that matter.
We need jobs. Force companies to move their production back to the US with boycotts. If you can afford it, buy American. You may have less gadgets and cheap garbage lying around your house, but if people actually knew the right kinds of jobs were being created they would spend.
With higher interest rates, I would put my money in the bank and earn my interest. What small business owner would borrow to expand their business when interest rates rise and their ROI is constantly getting worse (with economic conditions)?