Ron Paul Fears The Future Under Janet Yellen "Is Grim Indeed"

Tyler Durden's picture

Submitted by Ron Paul via The Free Foundation,

The news that Janet Yellen was nominated to become the next Chairman of the Board of Governors of the Federal Reserve System was greeted with joy by financial markets and the financial press. Wall Street saw Yellen's nomination as a harbinger of continued easy money. Contrast this with the hand-wringing that took place when Larry Summers' name was still in the running. Pundits worried that Summers would be too cautious, too hawkish on inflation, or too close to big banks.

The reality is that there wouldn't have been a dime's worth of difference between Yellen's and Summers' monetary policy. No matter who is at the top, the conduct of monetary policy will be largely unchanged: large-scale money printing to bail out big banks. There may be some fiddling around the edges, but any monetary policy changes will be in style only, not in substance.

Yellen, like Bernanke, Summers, and everyone else within the Fed's orbit, believes in Keynesian economics. To economists of Yellen's persuasion, the solution to recession is to stimulate spending by creating more money. Wall Street need not worry about tapering of the Fed's massive program of quantitative easing under Yellen's reign. If anything, the Fed's trillion dollars of yearly money creation may even increase.

What is obvious to most people not captured by the system is that the Fed's loose monetary policy was the root cause of the current financial crisis. Just like the Great Depression, the stagflation of the 1970s, and every other recession of the past century, the current crisis resulted from the creation of money and credit by the Federal Reserve, which led to unsustainable economic booms.

Rather than allowing the malinvestments and bad debts caused by its money creation to liquidate, the Fed continually tries to prop them up. It pumps more and more money into the system, piling debt on top of debt on top of debt. Yellen will continue along those lines, and she might even end up being Ben Bernanke on steroids.

To Yellen, the booms and bust of the business cycle are random, unforeseen events that take place just because. The possibility that the Fed itself could be responsible for the booms and busts of the business cycle would never enter her head. Nor would such thoughts cross the minds of the hundreds of economists employed by the Fed. They will continue to think the same way they have for decades, interpreting economic data and market performance through the same distorted Keynesian lens, and advocating for the same flawed policies over and over.

As a result, the American people will continue to suffer decreases in the purchasing power of the dollar and a diminished standard of living. The phony recovery we find ourselves in is only due to the Fed's easy money policies. But the Fed cannot continue to purchase trillions of dollars of assets forever. Quantitative easing must end sometime, and at that point the economy will face the prospect of rising interest rates, mountains of bad debt and malinvested resources, and a Federal Reserve which holds several trillion dollars of worthless bonds.

The future of the US economy with Chairman Yellen at the helm is grim indeed, which provides all the more reason to end our system of central economic planning by getting rid of the Federal Reserve entirely. Ripping off the bandage may hurt some in the short run, but in the long term everyone will be better off. Anyway, most of this pain will be borne by the politicians, big banks, and other special interests who profit from the current system. Ending this current system of crony capitalism and moving to sound money and free markets is the only way to return to economic prosperity and a vibrant middle class.

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BLOTTO's picture

Destroy the financials

Groundhog Day's picture

anything unger Yellen is grim indeed.  She is repugnent.  Generations of inbreeding

knukles's picture

Where's Ron when we need him?
Fuck, Jimmy Carter was better than this shit....

SWRichmond's picture

"Anyway, most of this pain will be borne by the politicians, big banks, and other special interests who profit from the current system."


One way or the other... 

CPL's picture

OT:  Baidu is now accepting BitCoins as payment.


The BTC price is going apeshit now.  Means Google, priced in US, is going to be eaten unless Google adopts BTC.

boogerbently's picture

I'm REALLY hoping Paul and his ilk are the beneficiaries of the dem/GOP foolishness.

philipat's picture

I'm sure it won't be long until The Fed come up with a way to naked short paper Bitcoin?

Scarlett's picture



They got Corleone's approval on this one.  


Fasten your seatbelts, the 10-magnitude zombie outbreak is coming.


It has been a pleasure.

Dareconomics's picture

Yellen will increase QE, easing, accomodation or whatever euphemism they're using in order to maintain the status quo.  The marginal utility of each extra printed dollar is lower than the last.

James-Morrison's picture

At least Jimmy had his heart in the right place.
Bronco is a total sociopath.

NotApplicable's picture

The fact that he believed his own wishful thinking is still sociopathic, as is the entire concept of the greater good.

Notarocketscientist's picture

Actually Jimmy Carter was the last president with any sense - recall his speech about living beyond our means?  Nobody wanted to hear that - no sireee - we want to live large - and we will vote for anyone who promises us that.

redpill's picture

she likes easy money and fur pie in the morning

BLOTTO's picture

As i was saying...(i got caught off:)


('They') Destroy the financials,

destroy religions,

destroy genders,

and destroy families...

so they can replace with a one new world order.

aerojet's picture

I doubt that they set out to accomplish any of the things you listed.  Rap music culture has done more to destroy families than anything the Fed has done.  It's not like people were better off in 1913 or 1971, btw.  It's really all just flawed human beings with our flawed systems.  I still think that as bad as the dysfunction is today, it pales in comparies to the WWI era where an entire generation of men was pretty much wiped out of existence because of misplaced chivalric/Victorian era type thinking.  Progressives back then had one excuse:  They did not have history's awful tragedies to act as a stern warning about such horrifying stupidity.

mvsjcl's picture

Is that the Shit Just Happens Theory of social progress?

NotApplicable's picture

In 1913, one could save the purchasing power of a dollar, so I'd say things were infinitely better. Today, there is no escape from continual the non-stop theft of purchasing power.

Remember, saving is the result of producing more than you consume.

Element's picture

You need to do quite a lot of reading about the geopolitical string-pulling going on during WWI, if you think that was down to dodgy Victorian-era thinking. The Balfour Declaration is a smoking-gun, and how it came about explains much of what went on, especially toward the middle and end of WWI, and the US's involvement.

During the first meeting between Weizmann and Balfour in 1906, Balfour asked what Weizmann's objections were to the idea of a Jewish homeland in Uganda, (the Uganda Protectorate in East Africa in the British Uganda Programme), rather than in Palestine. According to Weizmann's memoir, the conversation went as follows:

"Mr. Balfour, supposing I was to offer you Paris instead of London, would you take it?" He sat up, looked at me, and answered: "But Dr. Weizmann, we have London." "That is true," I said, "but we had Jerusalem when London was a marsh." He ... said two things which I remember vividly. The first was: "Are there many Jews who think like you?" I answered: "I believe I speak the mind of millions of Jews whom you will never see and who cannot speak for themselves." ... To this he said: "If that is so you will one day be a force."[6]

Two months after Britain's declaration of war on the Ottoman Empire in November 1914, Zionist British cabinet member Herbert Samuel circulated a memorandum entitled The Future of Palestine to his cabinet colleagues. The memorandum stated that "I am assured that the solution of the problem of Palestine which would be much the most welcome to the leaders and supporters of the Zionist movement throughout the world would be the annexation of the country to the British Empire".


So that's what they did, largely colonial force cannon-fodder under British command took Palestine off the Turkish Empire, who handed it to the zionists. It's been endless wars and terrorism ever since.

pkea's picture

Would anything change policywise( is there any political will) if something happens to yellen( she is not a spring chicken)

Headbanger's picture

Ripping off the bandage won't matter now that the patient has already been bled to death!

yrad's picture

He is my President. I was a delegate for him in Ft. Worth and I am now a Texian Nationalist working on secession. Guess who I will work to nominate as our 3rd President of the Republic of Texas?

"Don't steal, the Government hates competition"

-Dr. Ron Paul

NOTaREALmerican's picture

Ron, Ron, Ron...  

Everybody loves spending Other People's Money.     Ya just gotta deal with the reality of humans, Ron.

BabyBen's picture

He makes more and more sense. FED Euthanasia!

Milestones's picture

Bingo Ron!! A right on article.                    Milestones

overthehill's picture

Excellent video! Thanks for including it. so, if the 'money' creation stops there can be no more debt creation, and no more money created to pay the interest on the existing debt (bonds). That's how we get to default. So be it.

It's time to force real money back into the system per the constitution!

It's known as starting over . . . .

All the people with no money won't lose anything. . .  just food stamps. That will have to be replaced by charity! (Depression days . . .)

Those who have money will have to be allowed to exchange it for a new PM backed currency. (Hopefully the gold is still in Fort Knox and or in New York.

Those who have PMs will be able to exchange them (or not) for any new PM backed currency.

Ron Paul for President!

TeamDepends's picture

Dr. Paul nails it again.  She's a Grimm-type hobbit who tricks you into cutting your arm off.

Tenshin Headache's picture

It's not a bandage to rip off. It's a cancer, and removing it will kill the patient. Not removing it will also kill the patient, only it will take more time.

therevolutionwas's picture

Right.  So the former would me more merciful.

ghostfaceinvestah's picture

I still like RP's idea to have the Fed write off their UST's as a solution to the debt ceiling.  Expose the farce for what it is - money printing.

James-Morrison's picture

We ain't even made it to Halloween in America,yet
(Unless you consider the masked goons in DC playing trick or treat with our money.)

Spastica Rex's picture

How's it going up there? I still miss you down here. :(

therevolutionwas's picture

'brreak on through, break on through. break on through to the other side

NOTaREALmerican's picture

Re;  Will springtime for America never come?

Only if we listen to Krugman, and build a 600 ship space navy - using "Keynesian" debt - to hold off the pending Alien Space invasion.

If it worked once, it can work again.

Spastica Rex's picture

Oh. I was actually just wondering when America gets its own Hitler.

Space navy sounds cool, though. I know a bunch of people are already signed up for a one way ticket to Mars. Surely, infinite sustainable growth is waiting for us among the stars. Can you imagine how cool slaughtering space Indians is going to be?!

bubblemania's picture

He's totally correct but what happens to all the debt owed and coming due. There needs to be a restructuring or much inflation to work us out of this trap. The later will be easier to swallow and the FED will do whatever it takes to start runaway inflation. They will keep rates low as long as possible to complete the transfer of wealth from the 99%.  

eddiebe's picture

QE doesn't need to end at all. What a quaint idea.


Yellen is just another actor on the FED's stage play(WE PRINT THE MONEY AND FUCK OFF PEASANTS)      

kralizec's picture

Grim - Check.

End central planning?  OK now that just hit my funny bone!  Dr Ron did that on purpose, didn't he!


The End Is Near!

Plan accordingly...or not, the fuck I care...

resurger's picture

 is she a Joo?!

DOW 36K, rejoice Kitko

epwpixieq-1's picture

Japan tried that already(38,916 to be precise), did not work out too well for Nikkei, will not work here either and meanwhile someone may get rich and many will get poor:^N225+Interactive#symbol=^n225;range=my;compare=;indicator=volume;charttype=area;crosshair=on;ohlcvalues=0;logscale=off;source=undefined;

With the small difference that when this all started in Japan, they did not have any debt. Choose your options wisely.

RaceToTheBottom's picture

Ron is a better writer than he used to be.

Frank N. Beans's picture

Ron's right.  Yellin and the fedheads are wrong.  Does it matter?  Will it change anything?



q99x2's picture

Yaaaa Ron Paul. I made my only campaign contribution to you (some of my Bernanke FASFA money.)

NRGIsFree's picture

LOL, "The possibility that the Fed itself could be responsible for the booms and busts of the business cycle would never enter her head."

Absolutely correct. They hire people trapped in the matrix to defend it. Brilliant!

A problem will never be resolved by the same level of consciousness that created it. So put small minded people in positions of power and the "problem" will never go away.

vxpatel's picture

as long as you are in the top 5% there really is no's just the other 95%, the people who don't matter, that have the problem.

aerojet's picture

It would require an awful lot of "capture" for that to be the case, but I guess it is possible.  Ideologues are often blinded to considerable horrors they created in their zeal for perfection.

silverserfer's picture

someone please tell Ron Paul to keep away from grassy knolls from here on out.