Ben Bernanke Just Told A Massive Lie About Milton Friedman

Submitted by Mike Krieger of Libertyblitzkrieg

Ben Bernanke Just Told A Massive Lie About Milton Friedman And I Can Prove It

Ben Bernanke is so desperate to find support regarding his steal from the poor and give to the 0.01% policies he is now telling blatant lies about famous, dead economists that can’t refute what he says.  In this case Milton Friedman.  In his Q&A today, The Bernank claimed:

*BERNANKE: MILTON FRIEDMAN WOULD HAVE SUPPORTED WHAT FED DOING

Well I suppose it’s easy to make things up about people that can’t claim otherwise, but he made a big mistake this time.  Why?  Because Anna Schwartz, who co-wrote the famous work “A Monetary History of the United States” with Milton Friedman in 1963, actually came on the record on several occasions calling out The Bernank and saying there’s no way Friedman would agree.  The sad part about this is it seems Bernanke waited until Schwartz died to really start spewing the lies.  This guy is not only dangerous he is despicable and increasingly desperate…

Don’t take it from me though, back in October 2008 Anna Schwartz had this to say in the Wall Street Journal:

Ms. Schwartz thinks that our central bankers and our Treasury Department are getting it wrong again.

This is not due to a lack of money available to lend, Ms. Schwartz says, but to a lack of faith in the ability of borrowers to repay their debts. “The Fed,” she argues, “has gone about as if the problem is a shortage of liquidity. That is not the basic problem. The basic problem for the markets is that [uncertainty] that the balance sheets of financial firms are credible.”

Rather, “firms that made wrong decisions should fail,” she says bluntly. “You shouldn’t rescue them. And once that’s established as a principle, I think the market recognizes that it makes sense. Everything works much better when wrong decisions are punished and good decisions make you rich.” The trouble is, “that’s not the way the world has been going in recent years.”

In 2002, Mr. Bernanke, then a Federal Reserve Board governor, said in a speech in honor of Mr. Friedman’s 90th birthday, “I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”

“This was [his] claim to be worthy of running the Fed,” she says. He was “familiar with history. He knew what had been done.” But perhaps this is actually Mr. Bernanke’s biggest problem. Today’s crisis isn’t a replay of the problem in the 1930s, but our central bankers have responded by using the tools they should have used then. They are fighting the last war. The result, she argues, has been failure. “I don’t see that they’ve achieved what they should have been trying to achieve. So my verdict on this present Fed leadership is that they have not really done their job.”

Full WSJ article here.

Not enough proof for you?  Well in tribute to Anna Schwartz after she passed in June of this year, Forbes wrote:

Greenspan’s successor, Ben Bernanke, has followed the same path in confronting the current economic crisis, Schwartz charges. Instead of the steady course that the monetarists recommend, the Fed and the Treasury “try to break news on a daily basis and they look for immediate gratification,” she says. “Bernanke is looking for sensations, with new developments every day.”

Yet isn’t Bernanke a disciple of Friedman and Schwartz? He publicly refers to them as mentors, and, thanks to their scientific breakthrough, he has famously declared that “the Great Depression will not happen again.” Bernanke is right about the past, Schwartz says, “but he is fighting the wrong war today; the present crisis has nothing to do with a lack of liquidity.”

Full Forbes article here.

Ben Bernanke, I didn’t think it was possible, but you have hit a new low.  History will not be kind to you.

Comments

[chump666]

The f*cker's brain has turned to mush.

Awaiting Mario saying that Italy thrived under fascism.

Can't wait for that one.

[chump666]

And Volcker is now offically senile, or he is smoking crack:

http://www.bloomberg.com/news/2012-10-01/volcker-says-fed-bond-buying-ha...

[Shelby Moore III]

Volcker may be correct that QE probably has no or very limited direct inflation impact, but I argue or explain that it does cause inflation indirectly by sustaining debt misallocation. See the detail at the following link:

http://www.mpettis.com/2012/09/16/by-2015-hard-commodity-prices-will-have-collapsed/#comment-16753

[chump666]

It's shrinking the value of USD denominated assets, which are mostly held by o/s investors.  It directly leads to energy inflation via oil staying bid, gas/pump prices offsetting operational costs etc etc etc.  Inflation. 

The only reason that the USD is slightly bid, is Asia is desperately trying to offset all out inflation (from the price oil again) by selling their currencies and buying USDs.

The Fed will come under a lot of scrutiny for their insanity, it will the public that will initiate it as their wealth is neutralized by inflation...from all corners.  

[polo007]

http://www.forbes.com/sites/investor/2012/10/01/five-stocks-to-buy-for-bond-ageddon/print/

One hiccup of liquidity, where bond buyers pull back from lending the U.S. cash for nothing, and these bonds would be turned into dead president cash.

This freshly minted cash would then flee into hard assets, and off goes a new asset bubble.

But where will this cash go? Euros? Yen?

In fact, the cash has nowhere to go… it has to be sucked up by liquid assets. Stocks.

Equities in huge multinationals are a currency hedge as well as a good inflation hedge. Big stocks have plenty of transparency and a very long trading record.

So investors keen to position themselves to survive “bond-ageddon” should realise the place to look is the giant market cap goliaths–ones paying dividends.

Here are some to put in your portfolio if you think the dam of cash will break.

Kellogg, Exxon, Wal-Mart, Time Warner, Dow Chemical

What a boring list. However, boring will be very attractive when bond prices start to melt.

The timing is, of course, very tricky. These impossible situations can drag on and on long past a point you would feel it was possible for them to continue. The sign to watch for is when the Fed starts to take new corporate debt onto its balance sheet.

Then the final episode of the great unwind will have begun. Monetising corporate debt is the last throw of the reflationary dice and will signpost one last, desperate attempt to keep the old system alive.

Yet even when it does, the sun will come up in the morning and life will go on as if nothing is happening, such is the chronic way the world changes.