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Yellen on US Economy

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Surprise, surprise! Federal Reserve Chair Janet Yellen stated on Monday 31st March that the Federal Reserve shall have to continue bolstering the US economy while it remains stuck in the rut of economic slump. Just as well she made the statement yesterday and not today, as everybody would have taken it for an April Fool’s Day prank…or she would have ended up with egg on her face.

Yellen stated (at the 2014 National Interagency Community Reinvestment Conference, March 31st) that the conditions for the labor market were tougher today than at any other time in any other recession. Of course, she would say that in exoneration of responsibility of the role of the Federal Reserve and the US government and their apparent lack to get the US economy moving despite spending immeasurable amounts to bolster the banks and inflate the stock markets. She spoke of the “extraordinary commitment” of the Fed. But, me thinks the lady has not understood. We don’t need commitment, we need action and results.

She spoke of the economy being far from where it should be right now and that the expectations of the Federal Reserve were failing to come to fruition. She said: “The past six years have been difficult for many Americans, but the hardships faced by some have shattered lives and families. Too many people know firsthand how devastating it is to lose a job at which you had succeeded and be unable to find another; to run through your savings and even lose your home.” But, again, it’s not compassion that we need, it’s action and results, once again. 
We have neither of those two and so all the compassion and understanding however (in)sincere it may be is of no good whatsoever.

But, it does have everything to do with spin-doctoring. The Federal Reserve has now moved into a new era of communication and the compassionate understanding Yellen is now story-telling her life away in the hope that the image changes for the Fed and the people get some spin on them and change opinion.

The Fed has rolled off some $3 trillion in easy money. Interest rates are nearly non-existent and have been for five years. She even said that “recovery still feels like a recession to many Americans, and it also looks that way in some economic statistics.” Feels like? It’s far more than just a feeling.

There are 7 million people working part-time according to her figures in the US and that would like to have a full-time job. Labor-force participation is down from pre-2008 levels of 66% to today’s level of 63%.

Ben Bernanke was economically condescending. Janet Yellen is now on her road-trip around the US visiting schools and talking about people she uses as endearing examples of the weighty burden of the economic crisis to show just how much she cares for the people down below: “For Dorine Poole, Jermaine Brownlee and Vicki Lira, and for millions of others dislocated by the Great Recession who continue to struggle, the cause of the slow recovery is enormously important.”

I wonder who will be shouting out “April Fool!” today when they look at the sorry state of affairs that the Federal Reserve is in and has got the people into! Is Janet Yellen the April Fool? It certainly looks as if Ben Bernanke stitched her up ‘good and proper’ by handing her the hot potato of the resolution of theQuantitative-Easing problem. There’s no chance of doing anything except making the people laugh, Janet. You’re not going to get yourself out of what Ben got you into. Anybody could have seen that. Still, you must have seen it coming. Keep the printing presses rolling, especially now that the European Union’s ECB is starting to fire up its own printing presses as they fall into deflationary pressure and stop spending. Or, maybe all of this was just a sad joke that the Federal Reserve wanted to play on the world today. Not funny!

Originally posted: Yellen on US Economy

 

 

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Thu, 04/03/2014 - 12:07 | 4621406 nofluer
nofluer's picture

"We don’t need commitment, we need action and results."

My "Two Step Program"
1. Eliminate the FED.
2. Put the US Treasury's checkbook in a safe that the Obama "administration" doesn't have the combination to, and make sure he gets NO Credit (financial or otherwise.)

As part of #1, we get the elimination of the term TBTF - and we get to see the huge dust cloud as the massive banks crash to the ground.

As part of #2 we get to see the US dollar revalue UPwards, interest rates will climb so that people will see an advantage to saving, and investment capital will once again flow from a source other than the fantasy money factory of the Fed.

Thu, 04/03/2014 - 11:19 | 4621252 3.7.77
3.7.77's picture

Same as GovMotors, bring out granny to show how compassionate they are.

Thu, 04/03/2014 - 11:22 | 4621259 3.7.77
3.7.77's picture

Ask yourself why the former CEO's of GovMotors, or maybe the CarZar who was our supposed watchdog,

aren't being grilled in congress.

Thu, 04/03/2014 - 10:20 | 4621031 chapaev's ghost
chapaev's ghost's picture

Everybody loves to hate on the FED and Yellen is a schmuck because she is painted into the same corner as Bernanke.

When the crisi hit in 2008, it manifested as a liquidity squeeze. In simpler terms, money dried up. We're talking the neccessity of money FLOWS here. Think of money as the electrons in an electronic circuit. There needs to be a certain voltage pressure to make the circuit work. 

When that pressure dropped, as in a brownout, what was the FED and the Gov't to do? Their options were limited. Here they are, in order of least to most courageous.

1. Pump liquidity back into the system, ie QE and MBS buybacks and FED purchases of T-bills.

2. Let the system implode, and then reuild the same system all over again from the wreckage.

3. Build a new system, designed upon entirely new ideas and concepts. It may or may not work, but why not try?

Put yourself in the shoes of the elite. Only ONE of these options will preserve your wealth and power. That it happens to be the safest and most cowardly option is simply a bonus.

I pity the elite. They have no connection to the items that constitute real permanent wealth, ie land, water cattle and arms. They may own all these things, but only from a distance. It is that distance that makes them helpless and vulnerable. The elite are weak and pitiful. They have relegated themselves to playing a part in a tragedy. We are now in the act where the tragic protagonist, having already destroyed himself, attempts to change his fate, but to no avail. All that is left for the elite is their final self-enucleation.

Thu, 04/03/2014 - 12:23 | 4621455 nofluer
nofluer's picture

Klas barato nicto.

KLAS BARATO NICTO!!!

Sir... it's not working. The robot's not coming. (I think I saw him at the ATM taking all of his money out of the banks.)

Or in other words, BULLFROGS!!! It "manifisted" as the collapse of huge legal acts (resulting from the repeal of Glass-Steagal by Clintoon et al) and illegal acts perpetrated on the financial system (such as the "coining of money" by non-governmental entities - ie the creation of the MBSs which were/are essentially "non-specific debt" - a definition of "money" - with absolutely NOTHING backing them), then such repercussions being SUPORTED by the FED and the US Govt and magnified in scope. And it kicked off a now about 5 year infestation of stagflation.

"Liquidity crisis"? Bullcrap.

Thu, 04/03/2014 - 12:19 | 4621445 detached.amusement
detached.amusement's picture

dude you cant step on the hose and then say there is something in the system that is stopping flow, now here, buy this bottled water at 5 bucks a bottle (on credit of course) while we try and figure out just what is hampering this "flow"...

Thu, 04/03/2014 - 09:45 | 4620912 moneybots
moneybots's picture

"She didn't take over a failed program from Ben B., she was one of the primary advocates for it all along.   Just goes to show, stupid is as stupid does, and it ain't going to change until the system collapses."

 

Bernanke knew it would be a failed program 20 years before he instituted it. 

It isn't about being stupid.

 

 

Thu, 04/03/2014 - 05:36 | 4620380 BringOnTheAsteroid
BringOnTheAsteroid's picture

Really, where's the Inquisition when you need one to tie a woman to a rack, shave her genitals and tear her ascunder.

Thu, 04/03/2014 - 00:30 | 4620084 Tall Tom
Tall Tom's picture

Yellen said, "Too many people know firsthand how devastating it is to lose a job at which you had succeeded and be unable to find another;..."

She is so out of touch.

 

If you had succeeded with your job then you would not need to look for another as your employer will have prospered from your labors.

 

Failure in companies happen because of the deadwood employees whom fail to contribute. Successful firms generally keep the productive employees and cut the deadwood out during tight monetary times.

Thu, 04/03/2014 - 12:21 | 4621451 detached.amusement
detached.amusement's picture

daresay far more often it happens when those in control of the purse strings abuse the shit out of it, then turn around and "try to cut dead wood" to "save a few bucks" which really means their own fkn salaries/bonuses.

Wed, 04/02/2014 - 23:21 | 4619943 dexter_morgan
dexter_morgan's picture

such a handsome woman

Thu, 04/03/2014 - 00:45 | 4620100 Kassandra
Kassandra's picture

Arrow up for making me laugh..

Wed, 04/02/2014 - 22:41 | 4619821 moneybots
moneybots's picture

For Dorine Poole, Jermaine Brownlee and Vicki Lira, and for millions of others dislocated by the Great Recession who continue to struggle, the cause of the slow recovery is enormously important.”

 

The cause is the FED itself.  The FED went to congress and EXTORTED money from the tax payers, instead of letting the bankers get what they RICHLY DESERVED.

 

The economy was never allowed to bottom out, so it can't truly recover, as the FED drowns it in more and more debt.  59 trillion now according to the story.

What the FED is doing is criminal.

 


Thu, 04/03/2014 - 08:22 | 4620615 Global Observer
Global Observer's picture

Henry Paulson, who blackmailed the Congress into passing the bank bailout, was Treasury Secretary, and didn't work for the Fed.

Yes, the economy should have been allowed to correct itself, but it was the government that stopped it from doing so. Even QE only converts one kind of bank assets (treasuries and MBSs) into another (reserves). For those that accuse the Fed of buying toxic paper, that may be true, but the Fed bought only that toxic paper that was backstopped by the government.

The Fed has no magical powers nor did it exercise any. It was the government that postponed the inevitable by bailing the banks out and backstopping toxic mortgages.

But their limitations will be exposed when the next meltdown happens, which is any time now, and you will get your wish. The economy will contract until all the malinvestment is flushed out. However, you may not like the consequent breakdown in the social order that follows it.

Thu, 04/03/2014 - 11:58 | 4621386 EconomicGenocide
EconomicGenocide's picture

The governmnet in its entirety is completely controlled by the FED and banks. Dont try blaming the gun, blame the shooter! The back stop as you so call it is provided by the FED. The governmnet is just the patsy being used as a fire wall against the flack that will fly when the SHTF!!

 

 

Thu, 04/03/2014 - 10:55 | 4621159 elwind45
elwind45's picture

ALL BACKSTOPPED BY PRODUCTIVE CITIZENS. As long as you borrow from the future you never owe today?

Wed, 04/02/2014 - 22:34 | 4619798 moneybots
moneybots's picture

"Janet Yellen is now on her road-trip around the US visiting schools and talking about people she uses as endearing examples of the weighty burden of the economic crisis to show just how much she cares for the people down below"

 

Really, a road trip?  Yellen doesn't care about the 99%.   Seriously, the 99% are not her constituents.  In fact she justified RUINING SAVERS, many of which are ELDERLY. 

Wed, 04/02/2014 - 22:22 | 4619771 Lets Buy The Dip
Lets Buy The Dip's picture

1) The bearded lady gave another perfect dip for the bulls. We are going to 1900 guys, and higher. 

2) Statistics show the market has been crashing every 7 years wtihout fail. They prop up the market. I did see some very SHOCKING studies, about the market crashing every 7 years in the last 20 years wow. Check it out here => http://bit.ly/1hj3Zwr It means there could be another one comes soon, but who know, it is interesting to look at. It seems planned. 

3) The markets with HFT are so rigged right now, you do not konw what to believe. 

4) If you think obama is doing this by accident, you need to go to google and research all this. Its all planned and all planned for the next crash coming. 

5) the next economic collapse will make 2008 look like a sunday church picnic. CAN YOU SAY "KAAABOOM!!!"

Wed, 04/02/2014 - 21:28 | 4619625 kurt
kurt's picture

Steamy Diarreah with a Side of Rice Pilaf or a Cob Salad.

Fried Vagina Vinagarette with Poo Sauce

Sea Eels Crawling out of a Horses Head with Supurnating Buboe Pate'

Wed, 04/02/2014 - 19:57 | 4619261 rsnoble
rsnoble's picture

Thank god it's a 'massive' recovery otherwise we'd be fucked!

Wed, 04/02/2014 - 19:54 | 4619238 AdvancingTime
AdvancingTime's picture

The recently released figures showing a strong decline in job formation over recent months may be more than a noisy statistic it may be an omen of danger ahead. This is a reminder that the task before Janet Yellen and the Federal reserve will be getting much more difficult.

Not only does this call into question claims the economy has reached escape velocity but lends credence to claims by others like me that QE and artificially low interest rates are not the answer.  These policies and massive government deficit spending can only carry a distorted economy so far. Expect this issue to come front and center in coming months as the Fed will come under increased scrutiny and experience increasing demands to defend their policies. More on this subject in the article below.

http://brucewilds.blogspot.com/2014/01/slower-job-growth-red-flag.html

Thu, 04/03/2014 - 11:00 | 4621173 elwind45
elwind45's picture

I DO EXPECT IT TO BE FRONT AND CENTER IN COMING MONTHS thank you MORE QE?

Wed, 04/02/2014 - 18:51 | 4619046 rlouis
rlouis's picture

She didn't take over a failed program from Ben B., she was one of the primary advocates for it all along.   Just goes to show, stupid is as stupid does, and it ain't going to change until the system collapses.

 

 

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