The Mechanical Fed: Fast for a Robot, Slow for a Dog

Wolf Richter's picture

Wolf Richter

Boston Dynamics, an engineering outfit spun off from MIT, develops a variety of ultra-cool to totally bizarre mechanical creatures, from the four-wheeled SandFlea that weighs 11 pounds and jumps 30 feet into the air to the two-legged humanoid Petman that walks and does knee bends and pushups, this being for the Army. Their four-legged dog and donkey-like creatures run and clamber over rock piles. In other words, while they don’t appear to be particularly useful in daily life, they’re the ultimate toys: noisy, expensive, rare, and hard to maintain. And what’s even better, much of this fun appears to be funded with tax-payer money through defense contracts. So please, people in Washington, stop talking about cutting the budget. We need our toys.

My favorite is a robot they call Cheetah. Funded by DARPA (Defense Advanced Research Projects Agency), it can do 18 mph, a new speed record for legged robots. It’s my favorite not because it's almost cute in its ugly manner or because it looks like a cheetah—it doesn’t, I mean, not even remotely—but because it reminds me of the Fed and its ways.

It's a bad sign when Zhou Xiaochuan, Governor of the mighty People’s Bank of China, whose joint has an even larger balance sheet than the Fed, is worried about the Fed’s free money policies—the combination of zero interest rates and quantitative easing—that have sent tsunami after tsunami of dollars bouncing around the world, driving up markets and prices, creating dislocations and bubbles, and heating up inflation.

Zhou is in the hot seat: a big chunk of China's $3.2 trillion in foreign exchange reserves are held in dollars—the very currency that the Fed is trying to devalue. He is worried about the dollar because it's still, though maybe not much longer, the world's most important reserve currency. He was practically begging the Fed to act a bit more responsibly (good luck!) because he wants to "gradually bring inflation down" in China, he said. Utterly alien words to the Fed.

That’s why Cheetah is reminiscent of the Fed: it runs backward, rather than forward. It makes a lot of noise when it moves, and the faster it moves, the more noise it makes. But it runs on a treadmill, so reasonable minds doubt that it will ever get anywhere. Its top speed of 18 mph, though a record for legged robots and fast for humans, is quite slow for a dog. Maybe a lapdog would find that speed challenging. And for a real cheetah doing 75 mph, well....

It’s powered by an off-screen hydraulic pump. All we see are the hydraulic lines that hang down from some boom and connect to its back. There also appears to be a rope-and-pulley system for controlling the thing if it were to go awry. A human hand and an arm dressed in ominous black hold the lines. But who is holding the controls that can make this thing speed up or slow down or come to a stop?

Here is the video

Just as the world's major central bankers spoke at the Fed conference in Washington, deficit-plagued and inflation-infested Turkey floated a plan to get its citizens to turn in their substantial pile of physical gold in exchange for paper “certificates,” a first step in what may become a process of gold confiscation. For that load of ironies, doublespeak, and red flags, read.... Gold Confiscation, Inflation, And Suddenly Virtuous Central Bankers.

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MikeMcGspot's picture

I for one do not want to win the race to a point of singularity.

The finish line is stasis.

Transendence is not free lunch.

While I appreciate the debate about what is the right model, my gut tells me we should tax every share trade at one tenth percent per sale transaction on the buy and sell.

Time to change the equation.

Paul Bogdanich's picture

The internet, fiber optics, epoxy, UV resistant paint, semiconductors, lasers, microwave sources, and a variety of other inventions were all government funded before they went commercial.  That is how the system works best.  Private corporations are too busy paying ouitrageous upper level salaries to fund basic research.  So please stop demonstrating either your ignorance or very young age with the derision to paying for research.  The state funded research at the expense of commercial gain is the basic reason why the Chinese are growing their economy 5 times faster than we are.  Pay for the research and dump the mistakes.  Real simple.  We did it from 1937 through 1974.  The when we stopped look what happened.  We lost our technical advantage in a mere 35 years.     

DonutBoy's picture

It's not that way I'm afraid.  I've worked with DARPA. They beg to jump on your research so they can generate a powerpoint showing how they are, in fact, the source of all this wonder.  Our government is busy investing now in solar cell manufacturer's.  How's that Solyndra thing coming along?  The bureaucrats are doing so much better than the evil private investors.  The Chinese are building empty cities and counting every construction dollar spent in GDP.  It generates no return.  It's a loss.  They'd be better off giving the money away.

We lost our technical lead when we elevated banking to society's royalty.  Through the wonder of fiat currency a simple utility function that should be staffed by the 'C' students has become the owner of all nominal wealth.


StychoKiller's picture

Isn't there some Senate Committee meeting you should be attending? :>D

steve from virginia's picture


Xiaochuan has a much larger problem than dollar f/x and even fuel prices, it's spelled:

E - U - R - O.


skepticCarl's picture

What the heck was this article about?

Schmuck Raker's picture

Thanks Carl.

For a minute there, I thought it might be the rum.

Stuck on Zero's picture

The Author is implying that Bernanke is a Chinese made robot capable of producing huge amounts cash with almost no value.

vmromk's picture

Hey Bernanke, SUCK MY COCK.

Paul Bogdanich's picture

These comments add nothing are juvenile and should be censored.  They cheapen what used to be a pretty good blog.  Not so much anymore. 

vmromk's picture

The comments are juvenile ?

I guess your opinion counts more than others ?

It appears that you are of the belief that what Bernanke has and is doing will be of benefit to you.

Bogdanich, you are a moron and you deserve to get your news from CNBC and Fox, you arrogant ASSHOLE.

Zero Govt's picture

the cheaper the comments the better

it's deflationary and anti-Fed policy

Colombian Gringo's picture

Too late. Obama's ahead of you.