With The World Burning Around Them, The Fed Was Debating This Epic Question

Tyler Durden's picture

"We are not clueless," Kevin Warsh notes in this September 16th 2008 Federal Reserve transcript (as the entire financial system was imploding around them); but it is the final 'debate' in this brief section that sums up what Marc Faber has feared all along. Adjective or Abverb?


Via FOMC Transcripts,

MR. WARSH. I think the sentiment we are trying to suggest is watchful waiting. We are not indifferent, we are not clueless, we are paying attention, but we are not predisposed. Hence, Governor Kohn’s suggestion.

MR. KOHN. My suggestion was to substitute “carefully” for “closely.” I agree that “monitor closely” had this other connotation, but I think we should be seen as paying more attention than usual. There might be another alternative.

MR. DUDLEY. “The Committee will carefully evaluate economic and financial market developments.” That means you are on the case.

CHAIRMAN BERNANKE. Well, it is not an analytical thing we are doing. We are just watching closely.

MR. WARSH. Keenly? Carefully?

MR. LACKER. Mr. Chairman?

CHAIRMAN BERNANKE. Yes. President Lacker.

MR. LACKER. Including “closely,” what does that imply about the opposite? I mean, are we going to be able to take that out?

MR. WARSH. Well, we have done things like “in a timely manner” and other kinds of phraseology.

MR. LACKER. Yes, but this is an adjective.

CHAIRMAN BERNANKE. No, it’s an adverb.

MR. LACKER. There goes my credibility. [Laughter]




Perhaps that's why they get paid the big bucks (or not as it appears)

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Winston Churchill's picture

Could turn you anti semantic.

SilverIsKing's picture

They left out the part where someone volunteers to call Jamie and Lloyd to read them the statement before it is made public.

SoberOne's picture

The ONE time BernanQE got anything right.

eclectic syncretist's picture

They are only concerned with how they appear, and that they appear to be in control, because at the end of the day they (and the FRNs they print/counterfeit) are inescapably legitamized only by the people's confidence in them.  This short dialogue sums it all up very clearly for anyone willing to stomach the gut-wrenching reality of how precarious and even illusory our global financial system is.

idea_hamster's picture

BERNANKE. Well, it is not an analytical thing we are doing

You got that right -- thanks for the honesty.  And ... scene.

HyBrasilian's picture

HERE TO GO [to explanation]


"When you smell the smoke

You don't need to be told

What you got to do...


But there's a certain breed

So very inbetween

they'd rather take a vote...


Runnin short on time

still they can't decide

what we already know..."

jbvtme's picture

is this a fed meeting or a fireside chat at the local synagogue?

jbvtme's picture

meanwhile, in the colosseum next door, some christians were drawng straws to see who would fight the next tiger...

The Vineyard's picture

Yeah, yeah.  The FED is bad.  We get it.  Blah, blah.

mjcOH1's picture

"MR. LACKER. Yes, but this is an adjective.

CHAIRMAN BERNANKE. No, it’s an adverb.

MR. LACKER. There goes my credibility. [Laughter]"


But enough of the levity....should we devalue the currency by 50% within 10 years?   Or by 70%?

realWhiteNight123129's picture

They were splitting hair "closely" or "carefully" while the mother of all credit bubbles was imploding.


akak's picture

They were all "closely" putting their thumbs up their asses while "carefully" picking all of our pockets to bail out the TBTF banks and Wall Street.

Stackers's picture

And this is what they argue about while the world financial system implodes in front of them ?


For some more context lets take a time warp back to January 2009 on CSPAN as Rep Paul Kanjorski Chairman for Capital Markets Committee explains exactly what was happening the week of September 15, 2008. The above meeting was 4 days after the event being described by Mr. Kanjorski.


machineh's picture

'Well, it is not an analytical thing we are doing. We are just watching closely.'

Man, that is some pervy circle jerk, 'watching closely.'

Soul Glow's picture

Imagine the funding power to be able to withdraw $5.5 trillion in a single afternoon. 

That is not just a single entity, that is a collective.

Be it China, the House of Saud, Russia, and various other smaller players, there was a concerted run on the banks.  The result was a run on everything from equity, to bonds, to gold - although the gold run ceased in the fall and the equity run continued until further measures were put in place in the following spring.

This happened over 5 years ago and there has been nothing to solve this problem except print massive amounts of fiat cash.  And fiat is an IOU on the bond notes.  If there is ever a run on bonds it will collapse the dollar because the faith of the two are tied together.

Flakmeister's picture

You do understand the difference between physical cash (which was not printed) and the stale reserves on file at the Fed?

The Fed levered up and now it has no real way to unwind...

Soul Glow's picture

Physical cash has the legth of life that lasts as long as it can stay intact and not tear and rip.  The digital currency is what the IMF play with before they go to sleep at night.

walküre's picture

$550 billion in a matter of one to two hours ... but still

The issue was never addressed and covered up just like everything else. All we can do is speculate who did this and for what purpose. We can wildly guess but we'll never know the full truth and that sucks.

ThroxxOfVron's picture

Indeed.  The assholes are NOT analyzing data, conditions, or even expectations.

They are crafting illusions.

Why would that be done unless to distract and obfuscate the true nature of the system?

One can only conclude that if the mechanics and true intent of the FED cabal/system were actually discussed openly that the public would not condone it.

Further: IF these carping craven creatures exemplify the best minds tptb allow into the cockpit a fucking horrible crash landing is absolutely inevitable.

They don't have control of their egos and cannot be honest as to their intentions and activities.

kchrisc's picture

"...are inescapably legitamized only by the people's confidence in them."

Partly, yes, but more so by the enouragement of "legitamacy" encouraged by their government partners-in-crime's guns.


"We are gods. Believe or be shot."


Jean Valjean's picture

My favorite quote on appearances:

...when a man spends his energy on appearing to have, he is all the time destroying what he has, and therein the very means of becoming what he desires to seem.  If he gains his end, his success is his punishment.

Geroge MacDonald

Withdrawn Sanction's picture

"...legitamized only by the people's confidence in them."

Yes, indeed.  See also, "confidence man" or its shortened version, con-man (or men, as you see it).

These con-men are dickering about adverbs and phraseology, while the ship is actually sinking.  The next day, 9/18, by 11am $550 billion was withdrawn from money market accounts.  Rep Kanjorski (D-Pa), goes on to claim that had this process been allowed to continue, estimates he was given claimed that $5.5 trillion would have been drawn out of the US money market system by 2pm that afternoon.

While that's a very dubious assertion (there weren't $5.5 T in MMAs--although money flowing out of the stock market and through the money market might have met the mark), the interesting point is the palpable level of fear stoked by the wordsmiths at the Fed and Hank "the shank" Paulson over the following 2 days.  After all, without elevated fear levels, how can the con-men loot the Treasury on behalf of corrupt and inept banksters?

outamyeffinway's picture

I remember Jim Rickards saying once (paraphrase) that 90% of the time central bankers are more concerned about HOW they say things than the actual policy itself.

Thought Processor's picture



All part of the plan.


A little behind schedule perhaps but still moving toward a managed reset, triggered by some as of yet unknown event which will have people clamoring for a one world system.


And then global fascism will become an overt reality instead of a covert one.


Unless of course those same people wise up to the 'ruse' and decide enough is enough.


Withdrawn Sanction's picture

"And then global fascism will become an overt reality instead of a covert one."

I dont know, it seems pretty in your face right now (NSA, NDAA, etc. etc.).  Also, the point about enough is enough is a good one.  Not sure what the tipping point/"trigger event" will be, but I suspect the goons are not as prepared as they like to think they are.

Indeed, the fear porn guys and governmetn shills are constantly flapping their gums and keyboards about the billion plus rounds of ammo bought by DHS and assorted branches of the thugocracy.  And granted, that's a lot of ammo; however, a quick search also shows that the US ranks no. 1 in gun ownership per person (Wiki says there are about 89 guns per 100 people).  If each gun has, say a dozen rounds stored with it, that's more than 3 billion rounds in private hands.

I can see why the thugs feel threatened enough to want to stock up.  Gives new meaning to the phrase, trigger event.

TeamDepends's picture

If I were you, I'd shut up about that.

HyBrasilian's picture

So if one were to say something like... "Fuck you you fucking fuck" [where's the adjective or adverb in that]?

1stepcloser's picture

Any of you homos touch my adverb, I'll kill ya!

buckethead's picture

I see what you did there.

Debating phraseology, grammar, and spelling is what many intardnet warriors resort to when found wanting for a valid and effective course of action. It's good to know our benevolent leaders at the premeir central bank have that same plan 'B'.

DoChenRollingBearing's picture

I was thinking the same...

"How many angels can dance on the head of a pin?"

machineh's picture

Or as the FOMC circle jerk participants often ask, 'How many angels can dance on the head of a penis?'

Beam Me Up Scotty's picture

"Debating phraseology, grammar, and spelling is what many intardnet warriors resort to when found wanting for a valid and effective course of action"

Like determining what the meaning of "is" is?

Winston Churchill's picture

 A little stupid levity and word play on this forum is one thing.

In that fedRes forum, at that time, its just ouright scary.Truly sociopathic.

From their ivory tower ,they can't even see the woods, let alone the trees.

machineh's picture

From their ivory tower ,they can't even see the words, let alone the trees.

Tinky's picture

You spelled "premier" incorrectly.

Baldrick's picture

yes. so the next time someone corrects your grammar tell them " stop getting all lacker on me."

whatthecurtains's picture

Benny Benny Benny, get your adverbs here!

Benny Benny Benny, got some adverbs here!

Come on down to Benny's, get the adverbs here!

You're going to need

If you write or read

Or even think about it