Ron Paul Grills Bernanke On The Massive Expansion To The IMF's New Arrangement To Borrow

Tyler Durden's picture

As we reported a few days ago, the IMF massively expanded its last resort bailout facility (NAB) by half a trillion dollars, in which the US was given the lead role in bailing out every country that has recourse to IMF funding. Yesterday, Ron Paul grilled Bernanke precisely on the nature of the expansion of the US role to the NAB: "The IMF has announced that they are going to open up the NAB which coincides with the crisis in Greece and Europe and how they are going to bailed out. The irony of this promise is that in the new arrangement Greece is going to put in $2.5 billion in. I think only a fiat monetary system worldwide can come up and have Greece help bail out Greece and be prepared to bail out even other countries. But we are going from $10 to $105 billion... We are committing $105 billion to bailing out the various countries of the world, this does two thing I want to get your comments on one why does it coincide with Greece, what are they anticipating, why do they need $560 billion, do we have a lot more trouble, and when it comes to that time when we have to make this commitment, who pays for this, where does it come from? Will this all come out of the printing press once again, as we are expected to bail out the world? Are you in favor of this increase in the IMF funding and our additional commitment to $105 billion?" Bernanke, of course, washes his hands of any imminent dollar devaluation - it is all someone else's responsibility to bail out life, the universe and everything else. Bernanke pushes on "I think in general having the IMF available to try to avoid crises is a good idea." Yet Paul pushes on "Where will this money come from? We are bankrupt too." Indeed we are, but nobody cares - that is simply some other poor shumck's problem. 

 

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Cognitive Dissonance's picture

"I think only a fiat monetary system worldwide can come up and have Greece help bail out Greece and be prepared to bail out even other countries."

The signature line. The insanity is that the average economists would not only disagree with this statement but insist that because they can do this, the system is "working". This is the type of logic one uses to remain in denial about the increasing level of burning oil that surrounds you as you climb higher and higher up the flag pole.

Yup, it's working all right. See, the proof is in the fact that I'm climbing higher and higher.

Slewburger's picture

"Yup, it's working all right. See, the proof is in the fact that I'm climbing higher and higher."

Reminds me of the rising tide lifts all boats argument.

sporb's picture

This is undoubtedly what they are thinking: if the lake is too shallow, put more water in.

I think they realize: in order to play nice with China's "managed economy" they would make themselves a managed economy too. I don't see any recognition of this fact in all the griping about "where is my perfect market? You promised me a perfect market!" Get over it - you're all commies now. Change your strategies accordingly.

I also think that, in a "gold standard economy" many of you would be digging ditches, 'cause there wouldn't be enough money around to be playing the margins all day long.

tmosley's picture

Not enough atoms, eh?

GetZeeGold's picture

Not enough atoms, eh?

 

Heh heh.....well gold is only worth about $39 an ounce so the problem comes in exchanging atoms for currency......I mean like a penny is way too much for an atom of gold and what if someone just wants the one atom.....glad I could clear that up for you.

sheeple's picture

The insanity is that the average economists would not only disagree with this statement but insist that because they can do this, the system is "working".

 

All Hail The Print Press; seems like they want to take down nations to their knees sooner rather later. Perhaps the 2 billion funded by Greek is for building an IMF office on a Palm-island-clone in the middle of the Mediterranean

Terminal Frost's picture

PonziWorld.  Get your tickets at your local ATM.

Bananamerican's picture

is that a dollar chart on Bernanke's face??

RP threw darts but i have to say BB seemed unflappable...prolly cuz RP has that "voice in the wilderness" vibe....At some point the wilderness, in toto, will emerge.

Hansel's picture

Unflappable???  Bernanke's most used word in his answers was a competition between "umm" and "uhh".

Selah's picture

It was hardly a "grilling".

Mr. Paul was WAY too easy on that doucheclown.

buzzsaw99's picture

ZimBen is a boy who got a shiny new printing press for his birthday.

hamurobby's picture

The voice of reason in chaos,  President, anyone?

nhsadika's picture

I wish he would ask a single question and make Bernanke answer it.  Over and over. Paul has to stop rambling and put the pressure on.

JohnKing's picture

For peeps accustomed to sound bites, Paul does indeed "ramble". You really have to think a little bit when listening to him. His is a revolution of ideas and I think he "rambles" on purpose so as to spur thought.

sheeple's picture

He sounds like he rambles cuz he's so familiar with the issues that he doesn't need to pause and "think" inorder to elaborate his points.

He's passionate about it as well

JohnKing's picture

True that, he's been hammering the same nail for decades.

sheeple's picture

Correct, America has 300 million + pop. and only a hand full such as Paul and Schiff have enf balls to stand out and say it out

Entremanure's picture

Don't even lump Schiff in the same league as Ron Paul.  Peter Schiff is a clown.

Cognitive Dissonance's picture

So says a 9 day veteran of ZH. Did you take the entire 9 days to come up with this gem?

WaterWings's picture

+1

Cass Sunstein's recruits must be suffering from writer's block.

They should stick to their schtick:

"This blog used to have intelligent reporting. This only diminishes the credibility of the blog."

Slewburger's picture

Agreed +1.

Some of the newer members seem to be doing some provocateuring. They are among us.

Marla And Me's picture

I love how CD is always on the prowl for new trolls.  He has an uncanny ability to spot them.  Thank you for your efforts, kind fellow.  We in this community are most thankful.  Stick to the issues people.  Try it.  I know it's hard because almost 100 years of psy-ops have shortened your attention span to one that rivals the fruit fly's, but you might actually get to learn something.  It's the very reason this site is proud of its anonymity.  It makes it harder to engage in ad hominems.

Miss Expectations's picture

I think of Ron Paul as a statesman (as opposed to a politician)...hence his unique style.  I also imagine he was a magnificent doctor.

Cognitive Dissonance's picture

Paul (along with others) has a time limit and must work within that limit. He knows the answers he gets will be bullshit and he won't be allowed to really "grill" Bernanke to force Barnanke to actually "answer" the question.

So Paul is reduced to publicizing his positions with his remarks and then a question or two that he knows won't be answered but makes his point. He's an island surrounded by an empty ocean of fellow Reps with no balls to fight the system.

Think about that, consider that he's been surrounded for decades and then consider how you would fight the battle within the realty of the battle field. Plus his re-election every 2 years is under constant assault.

nevadan's picture

That is my biggest complaint about Paul and his attempts to get Bernanke to come clean.  The only way to get an answer out of Bernanke is to ask pointed questions, one at a time.  Preferably ones that would have a yes or no answer.  Bernanke is much too slippery to get a straight answer if he doesn't want to.

Cognitive Dissonance's picture

I've seen Paul fire point blank question after point blank question and Bernanke (and Greenspan) just slithers away. What about his colleagues? Why won't they follow with the same questions? Paul only has 5 minutes.

There are no "yes or no" questions or answers in finance. They build in reasonable doubt and obscurity precisely because they wish to avoid a situation where they could be held accountable.

Paul is one Representative out of hundreds. He is powerless without the help of his colleagues, which is exactly why the system can't be reformed from within. We must stop looking to Paul and a few others as our saviours. They can not save us from ourselves.

Without pointing directly at you nevadan, why aren't WE doing something about this?

RockyRacoon's picture

Well, I will be voting against any and all incumbents.  Period.

WaterWings's picture

NoooOOooo! Please don't vote. It's the consent to be governed.

verum quod lies's picture

Nevadan:

Paul has tried that approach. If you watch his earlier encounters with even Greenspan, you can sense that both he and the Fed Chairman (Bernanke now, or Greenspan before) know there is a five minute limit. Therefore, either he drones or the Fed guy does. Given a choice, i'll take his dronings over the Fed guy's, my guess is that you would too.

 

TwoJacks's picture

"remember, George, it's not really a lie if you believe it."

 

I think Bernanke really believes that he is NOT creating money out of thin air when he gives any entity a loan.

The Merchant of Venice's picture

He cannot admit that.  He has to say it is a loan.

The hearings are showcase showdowns.  All the little critters have to use the right talking points or their admissions will circulate in the media echo chamber for weeks.

RockyRacoon's picture

Right!  My giving you a handful of pocket lint does not constitute a loan.

JohnKing's picture

Bernanke knows full well that he is debasing the currency and using OPM. He is destroying  capital/wealth/savings at every turn and he is held in such esteem, why is he not in prison?

aaronvelasquez's picture

It really isn't created out of thin air.  It is created by skimming from all holders of dollars.

sheeple's picture

and have Greece help bail out Greece and be prepared to bail out even other countries

Gotta love Paul's in-your-face straight-to-the-point style

 

 

schoolsout's picture

sounds like a Repo $105B....except we aren't swapping, we are just giving the $105B away

nedwardkelly's picture

Paul: "Where will this money come from?"

Bernanke: "Well it's a loan"

Paul: "So you'd create it out of thin air?"

Bernanke: "Well if it's not paid back we'd have to take some of the loss"

 

Not sure there was an answer there...

 

aaronvelasquez's picture

If its not paid back, but it never existed in the first place, is it really a loss?

Waterfallsparkles's picture

The next question should have been who is going to pay for that "loan" plus the interest on that loan?  The American Taxpayers of course.

RockyRacoon's picture

The "loan" is created the same way a bank makes you a loan:  The digital loan appears on the books of the bank, not as an offset to the poor depositors' savings accounts.  This sort of "loan" is how the credit crisis mounted up to a disaster.  If banks can do it, the FED can do it.  Setting a good example, huh?

williambanzai7's picture

Lets face it, the man is not paid to tell the truth.

Cognitive Dissonance's picture

We seem to be caught in this vicious cycle of wishing and hoping that these bastards will suddenly break down in tears and confess to the world all their evil deeds. Not going to happen. We either force the issue or we bend over.

What's it going to be folks? It looks like it's shit or get off the pot time.

Eally Ucked's picture

Ron Paul talks to much, he has to wait for answers! And then grill the ....!

I guess the system got so screwed up that everybody has to show their oral skills and forget about the matter.

 

EllisWyattOTC's picture

Ron Paul is an American Hero!

geminiRX's picture

Not sure why the above message this is flagged as junk? Watching this from north of your border - he seems like the only voice of reason in your entire elected body. 

tradertim's picture

if someone asks me if they can borrow 10 bucks from me, i have to have that 10 bucks to give it to them to borrow. if i don't have the 10 bucks, i can't just go draw a picture of it on a piece of paper and hand it to my friend and say "here's your 10 dollars".

when ron paul asked..."where will the money come from?" and benny said.."well..it's a loan!!"...ron paul should have pressed him and said.."i understand it's a loan but WHERE WILL THE F*&%ING MONEY COME FROM TO LOAN IT???"

as ron paul said, the usa is bankrupt too.

Racer's picture

"Where will this money come from? We are bankrupt too."

 

How can a bankrupt loan money they haven't got?

Tally Sticks anyone?

Amish Hacker's picture

"How can a bankrupt loan money they haven't got?"

Easy. First, redefine "bankrupt." Second, redefine "money."

Problem solved.