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"QE Was A Massive Gift Intended To Boost Wealth", Fed President Admits

Tyler Durden's picture




 

With Bernanke gone, the remaining Fed members knowing full well they will be crucified, metaphorically of course (if not literally) when it all inevitably comes crashing down, are finally at liberty with their words... and the truth is bleeding out courtesy of the president of the Dallas Fed, via Bloomberg.

  • FISHER SAYS QE WAS A MASSIVE GIFT INTENDED TO BOOST WEALTH

Which incidentally coincides with Bernanke's heartfelt "admission" that "my natural inclinations, even if it weren’t for the legal mandate, would be to try to help the average person." As long as helped to boost the wealth of the non-average billionaire., all is forgiven. "The result was there are still many people after the crisis who still feel that it was unfair that some companies got helped and small banks and small business and average families didn’t get direct help,” Bernanke said. “It’s a hard perception to break." The truth, as again revealed by Fisher, will not help with breaking that perception.

We wonder how President Obama, that crusader for fairness, equality and all time Russell 200,000 highs, will feel about that? In the meantime, just like the Herp, QE is the gift that keeps on giving.. and giving... and giving... to the 0.001%.

US Income Gap Soars To Widest Since "Roaring 20s"

 

Record US Income Inequality In One Chart

 

Shopping With Bernanke: Where QE Cash Ends Up Tells Us Who Benefited

 

 

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Fri, 03/21/2014 - 15:10 | 4578078 ebworthen
ebworthen's picture

Well yes, a programmed planned fleecing of the middle class concomitant with:  repeal of banking laws enacted after the last generational collapse, defined contribution plans (401K's/IRA's) that give the gambling houses formerly known as banks chips to play with, the selling out of productive capacity and career employment to a communist regime enslaving it's people (China), encouraging home equity loans/liar loans/consumer debt of any stripe, 0.05% interest on savings, fees out the ass for holding your money, rampant cronyism and refusal to enforce the rule-of-law, false-flag wars and obedience to the M.I.C., and a superficial "rah-rah!" societal mindset of microwave meals and 30 second Twitter byte Facebook shallowness in the young generations of carefully groomed juvenile narcissists who are going to change the world with circle-jerk discussion groups and zero actions - the plan seems quite clear.

Fri, 03/21/2014 - 17:20 | 4578548 drdolittle
drdolittle's picture

Damn, well done. I think you got it all in 8 lines.

Fri, 03/21/2014 - 15:15 | 4578095 jubber
jubber's picture

Surely this is the moment we sell off ...and don't rebound?

European futures still falling, very unusual for a Friday...this should be a follow on from Wednesday without the  intervention...a rush for the door...

Fri, 03/21/2014 - 15:16 | 4578106 yogibear
yogibear's picture

It comes down to socializing losses and privatizing profits. All for the good of the banksters.

Fri, 03/21/2014 - 18:27 | 4578737 MeelionDollerBogus
MeelionDollerBogus's picture

Heads I win,

Tails you lose,

That is why

I'm richer than you's!

- evil twin of Limerick King, minion of Jamie Dimon

Fri, 03/21/2014 - 15:17 | 4578114 blindman
blindman's picture

the urinate down theory of weather forecasting
or litigation,
or was it tinkle down political hypothesis?
or the steal it all for the good of all economic theory?
.
..."pick it up and eat it". c.h.
Pretenders Waste Not Want Not
http://www.youtube.com/watch?v=UkL9SwhuDQQ

Fri, 03/21/2014 - 15:25 | 4578156 blindman
blindman's picture

so we have the federal reserve as the central bank
of/for the usa (and given the feds make up and history)
and the phrase long term financial survival is employed
as a potential outcome or goal?
i sense a fundamental disconnect in the logic or
use of the language.
money debt is issued out of thin air based on nothing
more than the remembrance of a fart, if that,
and that is the strong argument for monetary
and fiscal long term survival.
anyway ....
sovereigns only employ accounting to intimidate
their competition, other than that they never
take it seriously.
.
even the banksters are realising the scarcity of
"money" to repay that which is fraudulently induced.
the emperor has no empire.
.
it is a sovereignty scam perpetrated by the
high priests of spreading ignorance,
nothing new and as old as dirt or claims
on the same. the beauty of it is that it
provides the leverage for the few to own the many
by way of shame, confusion and mass incompetence
but that, too, is a double edged sword.
every game has its rules and the rules are
entirely arbitrary and relevant only to the game
at hand. they need not have any basis in anything
other than the participants can internalize them.
then the game can commence. that is money, an arbitrary
rule. nothing more. unfortunately, the rule of the game
is humanity must agonize the stupidity of the rule
and then die in ignorance at the direction of the high
priests.
so it goes.
.
also, because of the interest payment associated,
the system, activity or mechanism of lending process must
continue and increase to provide the liquidity necessary
for systemic stability and further economic activity, but ,
it can't and does not within constructed parameters of credit
and limits on moral hazard.
.
the money system was fraudulently designed that way
to replace human slavery, as slavery became abhorrent to
the enlightened age of reason mind the "owners" needed a
systemic fix to provide for the lost slave labor. this
"money" system that everyone is so confused about worked
perfectly as that replacement but up to a point.
"today"(broadly speaking), there
is so much incompetence and failure of the massaging of
the system (including outright fraud) that the essential nature
of the abomination is glaring even to the most distracted and
even they cannot fail to either see it or be profoundly impacted
by its criminal intent and nature.
the crime is nothing more than civilisation and its tendency
to push the limits of exploiting labor via symbolic miseducation
beyond the point of utility, perhaps?
in few words, pursuit of deadly greed, ambition and power;
watch for the judgement of that as has been advised.
.
there, the economic system in a nut shell.
leading to war for us......
Older men declare war. But it is the youth that must fight and die.
Herbert Hoover
.
Quotations about War

Give me the money that has been spent in war and I will clothe every man, woman, and child in an attire of which kings and queens will be proud. I will build a schoolhouse in every valley over the whole earth. I will crown every hillside with a place of worship consecrated to peace. ~Charles Sumner

War does not determine who is right - only who is left. ~Bertrand Russell

It'll be a great day when education gets all the money it wants and the Air Force has to hold a bake sale to buy bombers. ~Author unknown, quoted in You Said a Mouthful edited by Ronald D. Fuchs

I dream of giving birth to a child who will ask, "Mother, what was war?" ~Eve Merriam

The release of atom power has changed everything except our way of thinking... the solution to this problem lies in the heart of mankind. If only I had known, I should have become a watchmaker. ~Albert Einstein

The direct use of force is such a poor solution to any problem, it is generally employed only by small children and large nations. ~David Friedman

"There are no atheists in foxholes" isn't an argument against atheism, it's an argument against foxholes. ~James Morrow

Sometimes I think it should be a rule of war that you have to see somebody up close and get to know him before you can shoot him. ~M*A*S*H, Colonel Potter

All the arms we need are for hugging. ~Author Unknown

A soldier will fight long and hard for a bit of colored ribbon. ~Napoleon

If we do not end war - war will end us. Everybody says that, millions of people believe it, and nobody does anything. ~H.G. Wells, Things to Come (the "film story"), Part III, adapted from his 1933 novel The Shape of Things to Come, spoken by the character John Cabal (Thanks Bill!)

A great war leaves the country with three armies - an army of cripples, an army of mourners, and an army of thieves. ~German Proverb

The world has achieved brilliance without wisdom, power without conscience. Ours is a world of nuclear giants and ethical infants. We know more about war that we know about peace, more about killing that we know about living. ~Omar Bradley

Every gun that is made, every warship launched, every rocket fired signifies in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. This is not a way of life at all in any true sense. Under the clouds of war, it is humanity hanging on a cross of iron. ~Dwight D. Eisenhower, speech, American Society of Newspaper Editors, 16 April 1953

The most persistent sound which reverberates through men's history is the beating of war drums. ~Arthur Koestler, Janus: A Summing Up

What a cruel thing is war: to separate and destroy families and friends, and mar the purest joys and happiness God has granted us in this world; to fill our hearts with hatred instead of love for our neighbors, and to devastate the fair face of this beautiful world. ~Robert E. Lee, letter to his wife, 1864

Everyone's a pacifist between wars. It's like being a vegetarian between meals. ~Colman McCarthy

Nations have recently been led to borrow billions for war; no nation has ever borrowed largely for education. Probably, no nation is rich enough to pay for both war and civilization. We must make our choice; we cannot have both. ~Abraham Flexner

Draft beer, not people. ~Attributed to Bob Dylan

The problem in defense is how far you can go without destroying from within what you are trying to defend from without. ~Dwight D. Eisenhower

War will exist until that distant day when the conscientious objector enjoys the same reputation and prestige that the warrior does today. ~John F. Kennedy

Fri, 03/21/2014 - 18:25 | 4578734 MeelionDollerBogus
MeelionDollerBogus's picture

If we were each able & willing to issue & spend currency to each other without someone stopping us by law, and we were each consenting and not forced, that would be fine. Should anyone fail to deliver the goods in one way or another, it's the fault of the consenting for having taken on the risk.

With these mafia bankers there is no choice. They issue debt notes yet force us by law to use them and issue electronic credit with ease & claim it is equal by law to the debt notes, allowing massive dilution without the normal associated cost, or embarassment, of issuing trillion dollar printed bills, yet the effect of having so many currency units is the same.

Were it not for the laws holding us to be paid in such units we'd be done with this a long time ago.

Sat, 03/22/2014 - 14:47 | 4580614 caustixoid
caustixoid's picture

Were it not for the laws holding us to be paid in such units we'd be done with this a long time ago.

Slight correction:  you can be paid in whatever units you want, including barter.    The law is that you must pay your taxes with the mafia bankers' debt notes.    And "the law" means the threat of violence to take your possessions and throw you in prison. 

The whole system depends on violence.


Fri, 03/21/2014 - 15:18 | 4578121 SSN715
SSN715's picture

This needs to end violently (FUCK YOU NSA)

Fri, 03/21/2014 - 15:50 | 4578250 Inthemix96
Inthemix96's picture

SSN715.

It will.

Bank on it.

Mon, 03/24/2014 - 03:11 | 4578721 MeelionDollerBogus
Fri, 03/21/2014 - 15:18 | 4578122 SSN715
SSN715's picture

This needs to end violently (FUCK YOU NSA)

Fri, 03/21/2014 - 15:18 | 4578127 Warrior85
Warrior85's picture

This gift boosted my trading account:  copytrading

Fri, 03/21/2014 - 15:40 | 4578202 Yen Cross
Yen Cross's picture

    Is that you Robotard?

Fri, 03/21/2014 - 15:20 | 4578132 Champie
Champie's picture

Can someone point little ole stupid me to the place where Fisher is quoted, or his original comments are linked?

 

Maybe I have missed something, or the article here on ZH has been edited, but all I see is a bullet point that reasserts the headline and some stupid quotes from some paid for speech by Bernanke.

Sat, 03/22/2014 - 10:18 | 4580091 zanez
zanez's picture

Actual quote:  “I don’t think there’s any doubt that quantitative easing enabled the rich and the quick. It was a massive gift.”

 

http://zanesworld1.wordpress.com/2014/03/21/qe-is-a-massive-gift-to-the-...

 


Fri, 03/21/2014 - 15:21 | 4578139 DOGGONE
DOGGONE's picture

Hey Richard of Dallas,
Show charts, save many words!
Real Homes, Real Dow
http://www.showrealhist.com/RHandRD.html

Fri, 03/21/2014 - 15:42 | 4578183 One And Only
One And Only's picture

"The result was there are still many people after the crisis who still feel that it was unfair that some companies got helped and small banks and small business and average families didn’t get direct help,”

Look I concede that billionaires/millionaires etc were the chief beneficiaries of QE but a lot of average people got helped out too...refinancing from 8% to 3%. How bout that sub-prime car loan with 0% interest for 36 months? How was that possible? The ability to afford a much larger home due to lower interest rates making the payment lower. How about the governments ability to borrow money cheaply and spend it all over the god damn place. I don't know how many unemployed people I saw walking out of the grocery store with lobsters paid with food stamps driving off in brand new SUV's to their homes probably paid with section 8. Where did all that money come from? Are there no middle class people with stock holdings?

Know why we didn't have to cut spending? Because the FED was printing.

All the FED did was create a lot of hot air for everyone and anyone. Now the check is coming due and the hangover is starting to hurt.

Fri, 03/21/2014 - 18:16 | 4578713 MeelionDollerBogus
MeelionDollerBogus's picture

how is getting deeper into debt helping?
How is not cutting spending (on garbage) helping?

Sat, 03/22/2014 - 07:22 | 4579833 GetZeeGold
GetZeeGold's picture

 

 

We have to spend more so we can get elected....then we can work on spending less. We can only spend about 4 minutes on that...cause we have to worry about reelection.

 

Hope that helps.

Fri, 03/21/2014 - 19:03 | 4578805 ThroxxOfVron
ThroxxOfVron's picture

"Look I concede that billionaires/millionaires etc were the chief beneficiaries of QE but a lot of average people got helped out too...refinancing from 8% to 3%. How bout that sub-prime car loan with 0% interest for 36 months?"


How many people actually got those wonderful 3% ReFi rates you speak of?

Subprime auto loans?  Are you shitting me?  That is the big bone to the middle class out of $16+ Trillion in bailouts, guarantees and propping???!

The people that really needed those mythical 3% ReFi rates were the saps that had their CCard rates jacked from 6% to 25% in the spring of 2009, and then when they couldn't pay the new outrageously jacked minimum CCard bill had their Credit Rating trashed for it -and thus could NOT apply for and recieve the mythical 3% ReFi thereafter.   Everyone that got caught in the spring of 2009 who didn't already have the ReFi signed and in force was barred from anything approaching those rates!

The Romneys and their ilk might have gotten 3% ReFi rates; but, the Plumbers and their ilk first got fucked by their CCards with 25% rates and then were promptly denied a ReFi if they were dumb enough to pony up the fees and present the paperwork in hopes of it...

Further: everyone who were totally Bankrupted and tossed out of their homes in 2008 and 2009 and 2010, and who might just be getting over the hump of being shit on by Credit Report perusing prospective Employers, still haven't gotten past the 5 year mark where the stigma of BK had tended to soften in the past...  Subprime is exactly what those People have been boorishly relegated to.

It was the fucking BANKS that were bankrupt.  The Bankrupt Banks got the ZIRP and the Middle Class got it in the ass.

Don't act like the fucking FED window has been open to every middle class pissant and low wage worker in the US.

The Rich and the Connected got bailed out and the Average Joe and Jane got horsefucked.

Fri, 03/21/2014 - 19:22 | 4578893 I Write Code
I Write Code's picture

How bout that sub-prime car loan with 0% interest for 36 months? How was that possible? The ability to afford a much larger home due to lower interest rates making the payment lower. How about the governments ability to borrow money cheaply and spend it all over the god damn place. ... Where did all that money come from? Are there no middle class people with stock holdings?

You sure ask a lot of questions, Mr. Reid, and the answer to them is pretty much all "no".  Yeah, Bernanke probably told you that's what would happen, but it didn't, that's pretty much why he stopped returning your calls.  Fewer people bought cars at all and the intermediaries swallowed the ZIRP, not to mention the Japanese have been offering basically 0% loans for twenty years.  Government borrowed money is a liability even at zero percent, every dollar borrowed and spent is a loss, net of overheads.  Middle-class stock holdings are predominantly via retirement accounts and such anymore, and Bernanke's mythical "wealth effect" has proved no competition at all for the "poverty effect" of ballooning debt and the many uncertainties and obscenities of the Obamanation.

But thanks for playing.

ps - this thread has been drudged!

Fri, 03/21/2014 - 22:50 | 4579432 One And Only
One And Only's picture

"Yeah, Bernanke probably told you that's what would happen, but it didn't, that's pretty much why he stopped returning your calls. "

Subprime borrowers received 56.46 percent of loans on used cars in the quarter, up from 52.70 percent a year earlier.

http://www.zerohedge.com/news/will-we-never-learn-subprime-auto-loans-ac...

Fri, 03/21/2014 - 22:58 | 4579457 I Write Code
I Write Code's picture

Now let's find the average interest rate on this subprime auto loans.

Sure ain't zero:

Used-car loan interest rates have declined as well, averaging 17.78 percent for deep subprime, 14.17 percent for subprime, 9.33 percent for nonprime, 6.38 percent for prime and 4.46 percent for super prime.

Read more: http://www.bankrate.com/finance/auto/car-loan-rates-fall-risky-borrowers.aspx#ixzz2welbhDSP

If the economy were healthy more people would have better credit ratings, and would more than make up for normal interest rates.  I think these rates are about 1% lower than they were when tbonds paid 7% and people had jobs.

ZIRP kills, dude.

Sat, 03/22/2014 - 10:30 | 4580119 One And Only
One And Only's picture

Of course the interest rate is going to be higher if you have bad credit. However, it's the borrowers fault they are paying a higher rate due to their poor credit score. And don't give me this "it's the economy's fault people have bad credit" because there are PLENTY of people who have good credit despite the economy being bad.

Bottom line is if you NEED a car - to say - get to work, you wouldn't have been able to get one AT ALL had Bernanke not been printing money.

Am I agreeing with the policy? No. But to say ONLY billionaires benefited is a misnomer. I sited other examples above.

Sat, 03/22/2014 - 11:39 | 4580274 I Write Code
I Write Code's picture

You said:

How bout that sub-prime car loan with 0% interest for 36 months?

Well, there aren't any.  Or any of the other stuff you said.  That's not how this stuff works.  The general paranoid raving consensus here on ZH is MUCH closer to how stuff really works, than what you get from the MSM or White House today.

You're arguing for trickle-down.  You, who we must presume are a leftist echoing the Obamanation party line, are arguing for what used to be the plutocratic conservative position.  But if it comes from the government, you think it smells like roses.  Nope.  Oh, both sides are slightly right, there is something of a trickle-down, but it's not morally, ethically, politically, or economically the way to go.

Fri, 03/21/2014 - 15:34 | 4578188 happel
happel's picture

shocker.

Fri, 03/21/2014 - 15:35 | 4578190 TalkToLind
TalkToLind's picture

Pay no attention to the man behind the printing press.

Fri, 03/21/2014 - 15:41 | 4578205 SheepDog-One
SheepDog-One's picture

'Gift intended to boost wealth'....in the same sense that robbing an entire nation and handing the loot to a few banksters, that's all 'Q/E' and TARP and all that shit was....meanwile every american has been 'gifted' around $170,000 in new debt thanks to this'gift'. Gee thanks!

Fri, 03/21/2014 - 15:44 | 4578222 blindman
blindman's picture

"Give me control of a nation's money and I care not who makes the laws."
- Mayer Amschel Rothschild

Very few people seem to know the truth about the Federal Reserve and our monetary system. For whatever reason, this topic simply gets brushed over. Yet, the Federal Reserve and its monetary policy, does play a significant role in each of our lives. Afterall, the Fed controls the nation's money.
.
etc. ...etc...

Fri, 03/21/2014 - 15:42 | 4578213 blindman
blindman's picture

Pretenders - Space Invader - Riviera Theater Sept 8th 1980
http://www.youtube.com/watch?v=lKHcgfHkIz8
.
james honeymann-scott
confession:
father, i have sinned.
.
dedicated to the fed.

Fri, 03/21/2014 - 15:44 | 4578220 SheepDog-One
SheepDog-One's picture

And I don't even know what the fuck 'LVMH' is. Guess I'm not 'gifted' enough!

Fri, 03/21/2014 - 15:44 | 4578221 Yen Cross
Yen Cross's picture

   It (QE) was a gift alright... just like herpes is, after the drunken fuckfest ends.

Fri, 03/21/2014 - 15:49 | 4578244 Champie
Champie's picture

Did you see an excerpt from the actual statement by Fisher, or a link to the supposed Bloomberg source of this staement? Can you provide it here for me? I don't see anything that substantiates this headline. Thanks

Fri, 03/21/2014 - 15:57 | 4578272 Yen Cross
Yen Cross's picture

  I'm much too busy for such mundane tasks, which is why I trust Tylers' interpretation of Fishers speech. The content quality of Z/H far exceeds any of the BBG or RTRS crapola available.

Fri, 03/21/2014 - 15:59 | 4578276 Champie
Champie's picture

You're kidding, right? Is this how ZH operates? This is bullshit. The fucking article says "via Bloomberg," so where is it? Not a single person commenting here is interested in the source? Fucking idiots!

Fri, 03/21/2014 - 16:07 | 4578296 Yen Cross
Yen Cross's picture

  Awe, somebodies charts went red today. I'm sure your pals over at Yahoo, CNBS, and BBG will give you a hankie to cry in. Fisher is on the Hawkish side of things so it doesn'rt suprise me one bit that he'd make such a comment.

  If you're so vested in Fishers comments then why don't you provide the article, and I'll compare it to other sources for you.

 

  I guess we have an conspiracy? Fed's Fisher says QE was a 'massive gift' intended to boost wealth | ForexLive

Fri, 03/21/2014 - 16:09 | 4578311 Champie
Champie's picture

Wow! I just wanted to read what the dude said. I'm a broke ass bitch with a gun on my desk ready to blow my head off. I have nothing invested other than in interest in reading an article on ZH that provides at least a SINGLE FUCKING WORD related to the headline. Get it?

Fri, 03/21/2014 - 16:15 | 4578336 Yen Cross
Yen Cross's picture

  So you want me to fetch the article for you? That's probably why you're an "broke as bitch with a gun on my desk ready to blow my head off." Do yourself a favor. Put the gun down and  google Federal Reserve New York. You'll find Pdf. links to all of the Federal Reserve governors speeches for your reading entertainment.

Fri, 03/21/2014 - 16:14 | 4578338 Champie
Champie's picture

Are you even a real person, for Christ's sake? Is so, you are one stupid mother fucker

Fri, 03/21/2014 - 16:26 | 4578351 Yen Cross
Yen Cross's picture

     You're either an paid shill or off your Meds.  Make sure you load the gun before you pull the trigger Junior!

  Fed’s Fisher says QE was a ‘massive gift’ intended to boost wealth - Google Search

  FOMC Speak - A repository of speeches, testimony, interviews and commentary by FOMC participants

 

 

   
Fri, 03/21/2014 - 16:33 | 4578403 Champie
Champie's picture

Is that how you justify abandoning common sense? All searches on google link back to this ZH article or simply quote it verbatim. One leaves out the "via Bloomberg" part.

 

Who is the real shill here? I just asked for some accountability by ZH for providing a source mentioned in the article "via Bloomberg"

 

Do you get it now? How hard is it for the author to link the source?

Sat, 03/22/2014 - 10:20 | 4580098 zanez
zanez's picture

Actual quote:  “I don’t think there’s any doubt that quantitative easing enabled the rich and the quick. It was a massive gift.”

 

http://zanesworld1.wordpress.com/2014/03/21/qe-is-a-massive-gift-to-the-...

Sat, 03/22/2014 - 15:19 | 4580672 caustixoid
caustixoid's picture

Hats off to Champie for not letting go of his prove-the-source bone.

Bloomberg DID have news of a Fisher speech yesterday, although I can only find it on their Turkish site:

http://www.bloomberght.com/haberler/haber/1528681-fedfisher-qe-bu-yil-so...

Google translation does not mention any line like 'QE was a gift to the wealthy', but seems only to mention that bond purchases will be slowing. 

So apparently the English-language article about Fisher's most recent speech has been scrubbed from Bloomberg.   The comments on slowing bond purchases is enough to send the market into a tizzy, which would be justification for spiking it down the memory hole.  

Champie, if you're trying to say the Tylers made this speech up, well, sorry, there is a long track record of them not doing so AND a readership (perhaps like you) that would call them on it.  Too bad I had to do your work for you

Fri, 03/21/2014 - 15:49 | 4578245 holgerdanske
holgerdanske's picture

Being an engineer, I know there are no free lunches! That simply goes against any logice scientific measure.

so if this is a gift to anyone, it has been stolen from someone!

that is a simple as it gets.

Fraud!

Fri, 03/21/2014 - 15:50 | 4578247 Champie
Champie's picture

Being an engineer, do you see any actual statement by Fisher, or a link to the supposed Bloomberg source of his statement? Thanks

Fri, 03/21/2014 - 16:03 | 4578289 holgerdanske
holgerdanske's picture

No, I don't, and at this time of night, I really couldn't care less.

Sleep tight!

You are so welcome!

Fri, 03/21/2014 - 16:10 | 4578321 Champie
Champie's picture

Ok, so you are an engineer who doesn't give a shit about facts, got it!

Fri, 03/21/2014 - 17:58 | 4578664 MeelionDollerBogus
MeelionDollerBogus's picture

idiot: given a lack of facts about statements from people who have a lack of credibility, lack of honesty, why care?
All that matters is the end-game. My holdings. What I physically own & protect is what matters. Who said what, who quoted it when, has zero effect on me.

Fri, 03/21/2014 - 16:10 | 4578323 venturen
venturen's picture

Sadly both political parties are in on the game, of gaming the electorate. It seems America is ripe for major third party to take back our power. 

Fri, 03/21/2014 - 17:56 | 4578651 MeelionDollerBogus
MeelionDollerBogus's picture

Or, ripe for 1 party, the Goldman Sachs party, to start the 1000 year Banksreich.

Fri, 03/21/2014 - 16:11 | 4578328 moneybots
moneybots's picture

"FISHER SAYS QE WAS A MASSIVE GIFT INTENDED TO BOOST WEALTH"

 

QE boosted debt.

Fri, 03/21/2014 - 16:20 | 4578355 moneybots
moneybots's picture

" Which incidentally coincides with Bernanke's heartfelt "admission" that "my natural inclinations, even if it weren’t for the legal mandate, would be to try to help the average person." "

 

Bernanke has a bridge in Brooklyn for sale.

 


Fri, 03/21/2014 - 16:34 | 4578409 Rising Sun
Rising Sun's picture
"QE Was A Massive Gift Intended To Boost Wealth", Fed President Admits

 

Really Fisher??  Intended to boost the wealthy who park the proceeds off shore and leave the debt behind for the rest of us to clean up.

 

Honestly Fisher, burn in fucking hell!!!!!!!!

Fri, 03/21/2014 - 17:08 | 4578518 TrustWho
TrustWho's picture

I like Fisher best, but I agree....Honestly Fisher, burn in fucking hell!!!!!!!!

Fri, 03/21/2014 - 16:36 | 4578416 ejmoosa
ejmoosa's picture

Just wait until the bill comes in....

Fri, 03/21/2014 - 16:58 | 4578497 sschu
sschu's picture

The use of the term "wealth" here is offensive and grossly inaccurate.  No wealth was created.  Money was taken from one group and given to the other.  The groups are multiple, rich/middle class, sellers of stock at the artificial higher price/owner of inflated stocks now, investment banks/consumers, government workers/tax payers, those that benefited from artificial asset appreciation/those that did not.  Certainly there are others.

Ultimately they will have destroyed more wealth than created by their shenanigans. 

Printing money does not create wealth.  They created money, there is little if no gain in wealth.  Let’s get our terms straight.  Then we can deal with the perps of this injustice.

sschu

Sat, 03/22/2014 - 10:12 | 4580082 sschu
sschu's picture

 This entire statement really frosts me.  If they perceive this as a gift, this means they had/took the money and gave it to someone.  Let's be real, they took it from your children and gave it to various people who are politically connected or whose vote they are trying to buy.

The Fed has nothing, it is not their money and they just created it out of thin air.  This is so revealing about how they think.  So they stole the money and gave it away.

Generational theft - Fischer calls it a gift, I call it robbery.

Off with their heads!

sschu

Fri, 03/21/2014 - 18:22 | 4578730 MorningStar
MorningStar's picture

Is it time for the REVOLUTION against federal tyranny so we can have an honest government & our freedoms back?

Fri, 03/21/2014 - 18:45 | 4578795 yellowsub
yellowsub's picture

I figured by now you should realize that gov't is the problem.  

There will never be an honest gov't and you'll never have freedoms with one in place.  

Also it's not limited to federal, all levels of gov't down to munis screw us all over and enrich themselves.  

 

Fri, 03/21/2014 - 18:42 | 4578783 Paracelsus
Paracelsus's picture

Funny the FED bought all that MBS crap off the banks.(Watch out when someone says they are lowering standards for collateral!).Much of the stuff which is ARM would certainly explode into default territory if interest rates were to rise several points.They say the FED didn't purchase any toxic derivatives but I don't believe them at all at this point.There is a reason they don't want to be audited or stress tested.INSOLVENCY....

This country could use about ten thousand Ron Paul's.F*ck the FED and F*ck all neo-cons!

Fri, 03/21/2014 - 20:09 | 4579032 deerhunter
deerhunter's picture

just stop.  stop paying to renew drivers license.  stop buying tags for your license plate.  stop paying all debt,  charge card,  mortgage payment,  property taxes,  tolls,  license fees of all kinds,  don't pay for anything related to or regulated by any government or bank on all levels.  20% of the people with their eyes open to stop paying for any and all government fees and debts of any kind to banks or title companies or credit unions.  We would get their attention.  You cannot evict 20% of mortgage holders.  No property taxes no government schools using 14K per student to turn out those functionally illeterate who choose to hang around for 12 years.  Just stop.  No more money in any bank or checking account than is absolutely neccesary.  Just stop.  Taxation without representation once began a revolution.  

Fri, 03/21/2014 - 23:10 | 4579487 farmerjohn2112
farmerjohn2112's picture

+100 

Fri, 03/21/2014 - 22:21 | 4579349 optimator
optimator's picture

Massive gift to themselves from us.  And even if they stop it, its will be the gift that keeps on giving.

Fri, 03/21/2014 - 22:27 | 4579363 g'kar
g'kar's picture

Savers paid the price for this low interest rate Smörgåsbord.

Fri, 03/21/2014 - 22:37 | 4579396 Atomizer
Atomizer's picture

The Black metrosexual US Administration transparent family parasites are traveling the world on the niggers paycheck to visit China. We know the last two elections where nigger rigged. /sarc

 

Black Money- Dave Chappelle

 

Call out these thieving Marxist fuckers out on limited transparency.

Fri, 03/21/2014 - 23:35 | 4579424 Atomizer
Atomizer's picture

My words speak in volumes in terms of my Afro-American frends.


Fuck off, politically correct rats asses. I can drop the nigger word all day long. Why? There is no divide and conquer. You’ll be shut down before us. Now shit in your pants civil service worker.  I hope you dumb fucks realize your pension is short to pay-in obligation’s. Ask the fuckers how they borrowed your money and cannot pay back your pension obligations?

Fri, 03/21/2014 - 22:56 | 4579446 Jack Burton
Jack Burton's picture

QE was a planned theft and wealth transfer from anyone who works for wages or gains their income from a small business. Asset holders were given trillions in added value to bad investments which went tits up in 2008. In 2008 I was posting on Mish's blog screaming bloody murder over what the Fed was planning to do. The rape of savers, small business and wage earners has carried on while government spins lies of green shoots and recovery. Fucking wankers! Media spins their lies and New York City high end real estate has exploded in value and hundreds of thousands of middle class people who made some poor choices lost their homes. The difference is govenment let the middle class be fucked and stepped in to resuce all the asset holders who went long bad investments. Lesson, the 1% rule, the 99% are lied to and screwed. End of story.

Fri, 03/21/2014 - 23:37 | 4579552 samsara
samsara's picture

Another great post Jack. That's pertty much how it went.

Sat, 03/22/2014 - 11:13 | 4580232 EconomicGenocide
EconomicGenocide's picture

We all know the problem, but no one wants to discuss the solution. Voting and or protest will change nothing. How many of you go out on a limb and discuss in detail with retired and active military that the greatest threat t this country is the FED and banks. I will respect no soldier until they do the duty they swore an oath to. Until NYC is on fire and bankers are hung, we have no rule of law!!

Fri, 03/21/2014 - 22:59 | 4579459 Telemakhos
Telemakhos's picture

So, if I'm reading that first graph right, the Clinton administration was the best thing to happen to the über-rich since the end of WW1, slightly ahead of Reagan.  I suspect the rise in inequality has more to do with the dotcom bubble and increase in free trade leading to a decline in middle-class wealth production, while the lower post-WW2 inequality was the result of expanded war-time industrialization and post-war industrial supremacy, which now belongs to China.  Still, it illustrates nicely the notion (truth?) that the noisy "ideologies" of the parties are thin covers for a false choice between two sets of friends who want to help the rich who help them stay powerful.

Fri, 03/21/2014 - 23:04 | 4579476 QE49er
QE49er's picture

End the Fed & Pass the Ammunition

Fri, 03/21/2014 - 23:36 | 4579547 Downtoolong
Downtoolong's picture

Yellen Hires Particle Physicist To Detect Wealth Effect.

In the latest example of top scientific and mathematical minds being channeled into the financial sector, Janet Yellen, newly appointed Chair of the Federal Reserve has hired Nobel Prize winning particle physicist Naveen Gupta to prove the Wealth Effect actually does exist in the economy. Frustrated by naysayers who claim the Wealth Effect is only theory, Ms. Yellen has asked Mr. Gupta to help produce empirical evidence of its existence once and for all.

In our exclusive interview Naveen explained how his basic approach will be analogous to his prior work at the Hadron Collider. “In particle physics, you deal with very low probability events occurring on an incredibly small scale”, said Naveen. “You often must bombard matter trillions of times with high energy particles before you produce one measurable event or effect of the kind you’re looking for.”

“It’s the same with the Wealth Effect.”, says Gupta, “You have to bombard the economy with huge amounts of stimulus dollars to produce even one more dollar of marginal spending by wealthy people. In fact, we estimate the probability of that happening to be even lower than rare subatomic particle reactions; like one in a Google to the power of Avogadro’s Number or something. At the current pace of stimulus printing at the Federal Reserve it could take 100 years before we record a single example of the Wealth Effect. But, we’re confident the phenomenon does exist, and that Ms. Yellen will step up the pace of printing to produce a measurable event by the end of her first term. Considering the importance of this finding to defend the Feds stimulus programs, the $2 trillion allocated to this special project is not just a great investment by Ms. Yellen, but a necessary one.” 

Fri, 03/21/2014 - 23:44 | 4579569 samsara
samsara's picture

What were their Policies?

Who set the Policies?

Who does the FED work for?

Who Owns the FED?

Who is the Stock Holders of that Corporation(ie FED)

What 1%'ers Own the Companys that Hold the Stock in the FED?

Rock What?  Roth What?  Wal What? ......

They Did what Rock/Roth said to do I would Deduce.

Sat, 03/22/2014 - 00:51 | 4579648 Atomizer
Atomizer's picture

Sounds like you need to check on your snap card balance inquiry. The questions presented, are answers on how poverty is created under the (petro-dollar) universal US fiat. You have the NATO forces, Federal Reserve, UN, United Nations, IMF, World Bank, and Bank of International Settlements all shoring in to create debt to keep this Ponzi system pumping along till 2016.  It’s a rather sick outlook in developing a new financial system based on cooked books. For those poor fucks reading, you will end up broke in buying debt to pretend to be rich. We will recoin, you will end up a broke motherfucker. The good news, the companies above are laughing now. The panick mode will follow.

Sat, 03/22/2014 - 00:05 | 4579606 Atomizer
Atomizer's picture

This administration will blame this crisis in not opening the policy to undefended boarders in creating new tax income to keep the Ponzi system afloat.  Obama resonances the skill to run any private business. His mandate to drive all international business into one core international/financial business unit is going to back fire. No Executive order will institute such lofty ideals. Impeachment or bullets will follow his Hope & Change propaganda factor .  

Sat, 03/22/2014 - 01:05 | 4579656 elwind45
elwind45's picture

After ninety five years welcome back Van Winkle

Sat, 03/22/2014 - 01:28 | 4579671 Atomizer
Atomizer's picture

Rip Van Winkle to be honest

Sat, 03/22/2014 - 01:43 | 4579676 dogismycopilot
dogismycopilot's picture

True story: i was knew a guy whose father whose bank was part of the federal reserve system. ...his dad owned a chain of smallish banks. junior had a monster trust fund and he would give any young middle eastern crown prince a run for for his money in terms of pissing cash away on cars and women.

he had more money than heknew what to do with...and this was just one of the kids. for him to go out and just drop $300K on a new lambo was not unordinary..and this happened 3-4 times a year. 

every time i hear "federal reserve" i think of him and his trust fund. he was actually a very nice guy for someone who never worked a day in his life.

Sat, 03/22/2014 - 01:43 | 4579677 blindman
blindman's picture

"QE Was A Massive theft-Gift Intended To transfer-Boost Wealth", Fed President Admits
there, fixed it for him.

Sat, 03/22/2014 - 02:09 | 4579692 zionhead
zionhead's picture

QE: All BULLSHIT all the time.

The USA taxpayer QUIT funding the love-guv years ago, 1970's to be exact, that's when the USA went Bankrupt.

Ever since the USA went in DEBT to fund the gubmint, post 911 foreigners quit buy T-BONDS (US TREASURY DEBT), so now the FED had to create a new BUYER, in steps QE, end of fucking story. Now the FED is the only BUYER of US-DEBT on earth.

WHat's important is that WASH-DC is no longer beholden to the taxpayer or voter, now every politician knows that money grows on trees to infinite.

This article, and any article that mentions QE is just TRIBAL NARRATIVE to feed shit to morons.

*

This week of course the FED is sending trillions of USD FIAT to Brussels and they're now buying US debt, ... this is how the USA is being looted by TEL-AVIV, BRUSSELS and everywhere on earth, everybody is participating in the crime.
Should be interesting if any of this debt is made 'whole' post USA collapse, me thinks it will be and the DEBT will be carried on the backs of the USA hair-lips that don't die in the coming civil war.

Sat, 03/22/2014 - 02:31 | 4579705 Duc888
Duc888's picture

Funny, debt that has to be paid back, right?

Sat, 03/22/2014 - 02:33 | 4579709 Dre4dwolf
Dre4dwolf's picture

Why does debt have to be paid back?

What laws of physics are broken if no one pays debts back?

Sat, 03/22/2014 - 03:57 | 4579758 bunnyswanson
bunnyswanson's picture

Domino effect

Sat, 03/22/2014 - 04:33 | 4579781 blindman
blindman's picture

it has to be paid back because for the greater part
it can't be paid back so the assets and collateral
are forfeited to the lender and the state.
.
it is the design of slavery imprinted on the people by the elite
who are systemically important and require bailouts
to the amounts greater than in the trillions because
billions was not enough. i don't think it is really
a question of physics or even math, it is just an
arbitrary hard limit placed on labor. nobody likes
to work or perform labor anyway so who would care that
the money system is based on legalised fraud?
except of course when it no longer performs as advertised.
.
when the induction of the debt money becomes entirely
and transparently fraudulent the system has a serious problem.

Sat, 03/22/2014 - 02:32 | 4579708 Dre4dwolf
Dre4dwolf's picture

Whenever friends asks me when I think the economic collapse will happen.

I always tell them, that it will look like the economy is roaring, right before it crashes.

 

As it stands now, the economic outlook looks GREAT ON PAPER.

The correction is coming soon.

Sat, 03/22/2014 - 02:54 | 4579723 Perimetr
Perimetr's picture

Why only bribe politicians and military leaders, when you can bribe everybody?

Sat, 03/22/2014 - 04:07 | 4579763 Element
Element's picture

Maybe we'll see a rash of offical resignations so that a fresh batch of Neocon fellow travellers can be wheeled in.

Sat, 03/22/2014 - 04:53 | 4579789 no more banksters
no more banksters's picture

"Banksters : First: if more money were going to the market, then they would lose much of their value and we would lose profits because we are the ones who print money! That's why we invented inflation, to keep governments in fear and directing money back to us through the so-called Quantitative Easing Policies."

http://failedevolution.blogspot.gr/2013/12/an-imaginary-dialogue-between...

Sat, 03/22/2014 - 07:27 | 4579889 withglee
withglee's picture

If INFLATION of the Medium of Exchange were zero, as is proper, governments couldn't exist. Governments have two sources of income: Taxes and Inflation. People can (and do) resist taxes. Governments then "borrow" money (i.e. make trading promises and get them certified ... the certificates pay suppliers and employees). This borrowed money is never returned. The loans are just rolled over with new borrowings (rollovers are DEFAULTs).

Thus, that money continues to circulate, diluting the value of other trading promises circulating. INFLATION results by the relation: INFLATION = DEFAULT - INTEREST. Governments have convinced us (not me actually) that they are the best risk traders and deserve the lowest INTEREST. Actually they are the worst deadbeat traders and with a properly managed MOE, the INTEREST they would have to pay would make further borrowing impossible. 

They would go out of business ... or hopefully, throttle their business (services they claim to provide) back to the level for which the taxpayers are willing to pay.

Todd Marshall
Plantersville, TX

Sat, 03/22/2014 - 13:47 | 4580526 tip e. canoe
tip e. canoe's picture

that they are the best risk traders and deserve the lowest INTEREST.

...

but maybe gov't is just another
golem
to facilitate the process and
manipulate the perceptions?

and it ain't the only one
even though it very well may be the most effective
since it's the so-called writer/enforcer of the LAW.
(as it's so-called)

+1 for your recent posts, mr. todd of texas.
and +1000 for havin the cajones to put your name & location
out there for all to see (not just the All Seeing EYE)

Sat, 03/22/2014 - 04:57 | 4579791 Incubus
Incubus's picture

push, and push.

 

sooner or later the little guys are going to settle the score with lead.

 

Sat, 03/22/2014 - 11:49 | 4580291 Cthonic
Cthonic's picture

With lead!?  That would be too tidy.  Need something that will stand out in the history books so this shit doesn't happen again for another millenia or two...

Sat, 03/22/2014 - 05:45 | 4579817 falak pema
falak pema's picture

So much for "statism" ruining the world economy. Wealth boosting was for the private 0.01 %; the global happy few.

One big manipulation to have the state mechanism of DC Pax Americana Empire, and its Reserve curency,  SERVE the interests of the PRIVATE sector Oligarchy.

The smoking gun right in front of our noses keeps firing its dirty bullets to load the debt onto the public ledger all the while transferring thru the Bankster HFT manipulated web the paper and cash profits to the Caymanista bank accounts.

Its time that the blinkers came off on these neo-con/neo-liberal lies that started with "the end of history" and "the clash of civilization" hype of the Bushist NWO age. 

Our current tea party denizens are just false noses to that same tune when they say its "statism" that kills the US economy. 

Nope, its neo-feudal oligarchy rule that has total control of state, now in the hands of new Septimius Severus of Leptis Magna, its appointed/anointed front man, Caesar of Rome, with the same mindset as his predecessors; the man who built marble toilet seats in his home town as a gift to their glory (Obamacare)  and increased the Praetorian guard to 55000 to protect his imperial authority (NSA - yes we scan globally!).

Now embroiled in the great game of Cold War once again as the ME cauldron comes to boil as a result of past imperial hubris resulting  in inextricable military actions that have awesome blowback potential.

Sweet black oil and its sulfurous trail of gunpowder diplomacy.

Sat, 03/22/2014 - 07:02 | 4579869 overmedicatedun...
overmedicatedundersexed's picture

falak has posted for years, it's not .gov's fault, it's those criminals in charge, what great logic falak..perhaps you might tell us how any centralized .gov avoids being taken over, I guess you see angels who can run the socialist states you still cling to.

Sat, 03/22/2014 - 07:40 | 4579894 falak pema
falak pema's picture

I don't project into the future I debate fact and past momentum and consequences.

The debate between the individual and the collectivity -- in all its multiple forms--church theocracy, kings of divine rights, dictators, military rulers, elected despots, etc. is as old as the OTHER debate between Top down logic to build a nation or Bottom up logic  to achieve more people's rule.

There are no easy simple answers and human nature is not simple.

My posts here at ZH are recurrently about the momentum of current power constructs that run the world since 1945...

And the awesome twist that construct has acquired since 1980... 

Facts and consequences of past actions; that is the subject of my posts. Not saying statism is better. 

Just saying what occurred under FDR was a better solution in terms of Balance  than what has occurred post neo-liberal RR/MT mantra dictating the tune to the western political construct. That is the gist of my analysis : comparative geopolitics in the real world of facts and acts. 

I have NEVER been a proponent of statisim per se but of BALANCE between private and public domains and separation of powers. But that is THEORY...

WHat we discuss here is FACT and CONSEQUENCE of past acts. 

Your post brings NO CLARIFICATION to that issue; which is central to ZH's whole existence. 

Angels were never my line of thinking to solve this conundrum but transparency and debate on public issues, yes; always.

Sun, 03/23/2014 - 10:27 | 4582154 overmedicatedun...
overmedicatedundersexed's picture

falak, want's :"transparency and debate on public issues, yes; always." transparency as defined by say Obuma or Holder?, public issues debate away, while the very foundation of "facts" are constructed by the .gov's of the world ,good example AGW, or current economic .gov data. when one deals in lies when one deals with those who are corrupt, debate on almost any subject .gov has interest in - is moot.

Perhaps one could start with Justice is blind, and enforce that, but today thanks to modern fabian socialists we have relative justice relative history , and evolution of a constitution by extra constitutional means, as example the use of executive orders in USA , or in your neck of the woods  the violation of Irish voting rights by disallowing the vote on the EU, until the proper outcome was obtained.

Sat, 03/22/2014 - 05:47 | 4579821 zionhead
zionhead's picture

Zions Bank fails to pass Federal stress test

ksl.com - 7 hours ago

SALT LAKE CITY - One of Utah's largest banking institutions is the only large bank in the nation that did not meet the minimum standards for financial capital levels set by the Federal Reserve in the event of a major economic meltdown.

*

Is this possible? I thought Zionists printed their own money.

Sat, 03/22/2014 - 07:15 | 4579879 withglee
withglee's picture

Those are Mormon Zionists. Different club.

Sat, 03/22/2014 - 12:42 | 4580406 shutdown
shutdown's picture

Yes, a different club, but one of the two clubs shall forever remain open to only one race. 

Sat, 03/22/2014 - 11:07 | 4580218 icanhasbailout
icanhasbailout's picture

Zion National Park

 

worth your visit if you don't have to travel too terribly far to get there

Sat, 03/22/2014 - 13:50 | 4580532 tip e. canoe
tip e. canoe's picture

wouldn't surprise me if it all was a psy-op.

look over there : Zion's going bankrupt!

yeah right

Sat, 03/22/2014 - 06:03 | 4579826 Peter Pan
Peter Pan's picture

I have come late to the party but without reading all the comments, the boost was two-fold:

1. Their assets were revalued upwards quite strongly

2. They got an even bigger share of the increase in the earnings of the economy.

Sat, 03/22/2014 - 11:10 | 4580225 icanhasbailout
icanhasbailout's picture

It's simpler than that.

The Federal Reserve paid the banks to inflate speculative bubbles. Full stop.

Sat, 03/22/2014 - 08:20 | 4579924 justsayin2u
justsayin2u's picture

The community organizer in chief made sure the bernank would continue to print and finance the USA as a condition of employment.  The USA is officially a bananna republic under his leadership.  Law and common sense only matter if it agrees with his views.

Sat, 03/22/2014 - 08:28 | 4579932 ArmyofOne
ArmyofOne's picture

Tiffany's and Coach are so lower middle class reach up crap.  Charts is right but bad example of real the real money went.

Sat, 03/22/2014 - 08:33 | 4579939 d edwards
d edwards's picture

A much more accurate and honest statement would have been: "...intended to boost the wealth of BIG OBLAHMA DONORS, BUNDLERS AND VARIOUS OTHER CRONIES."

Sat, 03/22/2014 - 08:57 | 4579964 pcrs
pcrs's picture

boost the wealthy, small difference

Sat, 03/22/2014 - 09:07 | 4579978 Hayabusa
Hayabusa's picture

Well, lets see... ongoing QE is implemented... the money has to go somewhere... artificial money makes DOW go up... people feel more wealthy that own stock.... banks offer low interest loans.... people take them.... spend it in Tiffany, Coach, etc., and in the end analysis the people get deeper into debt who spent it and the busineeses that sell that crap make out along with the banks who charge interest - it's almost like this was planned... planned to concentrate even more wealth in the hands of the wealthy that is.  Nothing new here folks, nothing to see... move along now, move along.

Sat, 03/22/2014 - 09:08 | 4579983 Loophole
Loophole's picture

When they print money and use it, someone gains and others lose, depending on how they go about it. It's nothing but wealth transfer, a theft.

Right now, the Fed is subsidizing the bond market (and, therefore, the govt), the stock market, and the housing market. People everywhere with other money holdings will-one way or another- lose badly.

That's bad enough.

But when they stop "priming the pump," that is, giving the subsidies, the entities being subsidized will collapse.

Taking the rest of the economy with them.

And the savings of millions of Americans that could have been used to rebuild will have been destroyed by inflation.

By then the smart people will have gotten out of Dodge with their gold.

Sat, 03/22/2014 - 09:16 | 4579994 Last of the Mid...
Last of the Middle Class's picture

So basically, we gave away a shit pot full of money, in fact a whole economy's worth that your children's children will have to repay provided we haven't collapsed the economy allowing someone to come in and take over. Oh and did I mention you didn't get a fucking dime! This is how the fed operates, we're all equal until they start handing out trillions. What a perfect marriage between government and private industry.

Sat, 03/22/2014 - 09:19 | 4579997 thestarl
thestarl's picture

No words needed the graphs tell the story

Sat, 03/22/2014 - 10:29 | 4580118 Spirit of T.R.
Spirit of T.R.'s picture

What is fascinating about the income equality of the 1940s through 1960s is that the market also boomed during that time.  The difference is that during that time people had good jobs that paid well and they could save for goods and services.  In other words a strong economy meant a strong market.  Funny money and manipulation, overextension of credit, inflation, unemployment, low wages... these things do not create a strong economy, yet the Fed Heads blather on as the  charlatans they are.

Sat, 03/22/2014 - 10:40 | 4580144 rsnoble
rsnoble's picture

And here I thought I was upscale for drinking beer out of bottles instead of cans.  Speaking of which im thirsty.

Sat, 03/22/2014 - 11:31 | 4580258 JailBanksters
JailBanksters's picture

The Club Fed don't care what ordinary people think or even what the President thinks or does. They just live in their own little world just quietly devalueing their Private Monopoly Money every single day.

Sat, 03/22/2014 - 14:16 | 4580265 Cthonic
Cthonic's picture

Drooling proles to the left of me,

Nouveau riche billionaires to the right,

Here I am,

Stuck in the dwindling middle with you.

Well you started out with nothing,

And you're proud you were a self made man,

And your friends, they'll all come crawlin,

Slap you on the back and say,

Please... please...

Trying to make some sense of it all,

But I can see that it makes no sense at all,

Is it cool to nail a Fed member to the door,

'Cause I don't think that I can take anymore

Drooling proles to the left of me,

Nouveau riche billionaires to the right,

Here I am,

Stuck in this surreal shithole with you.

Sat, 03/22/2014 - 11:35 | 4580267 kellycriterion
kellycriterion's picture

Now am I supposed to believe Fed policy is based on magical thinking?

The Fed thinks confiscate up printing is manna from heaven? That their virtuous cycle theory(using the term extremely loosely)is frictionless, entropy-less, non-sticky perpetual motion?

Now it's been intimated if not trumpeted by the European CBs that the line between monetary policy and fiscal policy has become, shall we say, blurred. So are we down to the "we're zoned out druggies oblivious to everything but our own wish fulfillment fantasies", excuse?

Sat, 03/22/2014 - 11:47 | 4580289 novictim
novictim's picture

Face it.  Most of you don't have a clue as to what was playing out here with Fed policy/QE. But, trust me, at the corp, none of this is terribly complicated.

Who is right?

Trickle-Up economic principles (last seen in USA in the 1940-1960s) (Keynesian approach during down turns)

or

Trickle Down Economists (NeoClassical/Neoliberal Economics/Austrian SChool/Hayek and Chicago School/MiltonFriedman/Bernanke)(Free Markets, Austerity, Laissez faire, "the markets know best")

The answer is that it depends on what you need at the time:   Increased Consumption or Increased Production.  Economies are a balance of Production and Consumption. If you want to create sustainable growth, then BOTH must rise in tandem.  Trickle Down policies fit only the periods when production is insufficient...like post WWII Germany or Undeveloped Economies that have pent up demand but insufficient production capacity.

Trickle UP economic policies fit best when we have too much production capacity such that demand is insufficient.  Today people/consumers are BROKE!  They needed a raise going on 30+years now.  They are borrowed to the hilt and cannot borrow anymore.  

And we have massive waste via unemployed people and idle production facilities to the tune of >20%!!!

When Bernanke does his Quantitative Easing, he is addressing a problem of LOW production...that is the WRONG problem.  The chief effect of QE is to help make it easier to borrow money to build more factories/production facilities and this would then employ people.  But who will use it for this?  Do we need more production?  NO.  So what the hell!?

QE also helps consumption for a short time by by making debt more affordable.  But doesn't the Piper need be paid in the long run?  Yes!  But Ben is leaving before that happens, isn't he?  

Bernanke says he wanted to increase "middleclass wealth"?  Bullshit.  

Bernanke was criminally negligent when he pursued these Trickle-Down economic policies in this economy.  

Sat, 03/22/2014 - 12:24 | 4580364 novictim
novictim's picture

Hey.

Rather than just "Down Arrow" me, how about reading it and making a counter argument?

Sat, 03/22/2014 - 12:49 | 4580425 Comte d'herblay
Comte d'herblay's picture

Here's a "Counter argument" that trumps your take of the FED's intentions and actions.

While I want to see Bernanke hung from a pike, headfirst for killing the shorts, he is not entirely wrong about wanting to assist the middle class wealth building, or at least stability. He is being disingenuous though about how the trillions he printed, and Yellen is continuing to print are being used by the Jewish mafia that is getting nearly all of it.

The way I see it, Hank Paulson and some Heap Big Jefes at the big banks and insurance companies, and the Huge   pension fund managers that had quadrillions invested in Common stocks, had a confab. 

They were told that the US Justice department would not indict or prosecute them for their role in Mortgage Banking, CDSs, and CDOs, Derivatives and other financial shenanigans that tanked the world economy in 2008 IF they went back to the market with the newly printed cash in the trillions and bought those shares back that were in the cellar, and restored and MAINTAINED them at pre crash levels for at least 40 years.  No jail for them, just bigger bonuses for using that printed cash to buy back the shares up and down the exchanges. If Pension Fund A had to liquidate their 1,000,000 share of IBM to pay off the monthly pension checks that their fund insured, then one of the other banks had to buy them at the current price, no decline permitted due to the liquidation. And the FED would be the buyer of last resort if one of the others didn't offer to buy the shares. Woe to them if they did not, so they did. 

With all due haste the values of common stocks had to be brought back to record levels and the only ones who were in a position to make that happen were the aforementioned entities that owned most of those securities and sold them off in the midst of the crisis making matters far, far worse.  The crux of the matter was that those securities were the life savings of many middle class people who owned pensions at retirement, as well as 401ks, IRAs, SEPs, and other retirement vehicles that were worth half what they were worth a week before the crash began.

That could not stand.  

Naturally the wealthiest benefitted and always will, the most, but the middle classes were at least assured that as they retire this year and on out into the coming decades that their pension fund manager will sell the Cisco, Utility and other shares at tiny discounts or more likely at higher prices as the all time highs have shown. 

The smartest people in the room were those who held their positions in, say, the S & P 500 which went from 666 to record levels this week, tripling from 2008.  

N'est ce pas? 

 

 

Sat, 03/22/2014 - 13:37 | 4580511 novictim
novictim's picture

I'm up voting you for the act of "trying".

But we are talking, essentially, about different things.  And they do not necessarily contradict each other.  Your discussing the investor level, micro aspects of this QE policy on pensions and what you say is very important.

What I am discussing is the Macro-Economic implications of the policy.  

I'm looking at the Aunt mound from 20 feet up and you are looking at the queen from withing the mound.  Your concents are points of tremendous importance and show the level of insidious unfairness of this policy at the street level.  My points are about the longer run implications for economic growth and unemployment rates and standards of living...not saying that your points don't intersect cause they do.

Wealth inequality is the major impact of trade policy/relaxation of capital controls/tax policy and fiscal policy but I agree that the wealthy are the big winners from QE.

Thanks for the response! 

Sat, 03/22/2014 - 20:25 | 4581218 Comte d'herblay
Comte d'herblay's picture

What's missing from all the discussions I've seen is a singular blindness to the elephant: the Macro level 'problem' of too many people chasing too few jobs.  Globally.

Kurt Vonnegut dealt with this 40 yrs ago. He foresaw that day when human beans, most of them, would need to find something else to do not to go crazy.  Work, labor, of the mind or the hand, would eventually be put out of business.

Due to technological change, work as we know it, was doomed. Only a few per cent of the 7 billion people in the world would be needed to produce the goods and services that the 7 billion required for sustenance and a few pleasures, meanwhile what in hell were they going to do with all their time??

This state of things is already well on its way to fruition. Only 60% of the people in the U.S. work and so many of them are merely taking in each other's laundry, that it's safe to say that only 40% of the population produce anything. And less people are needed every year. 

When looking at other countries, all their problems stem from one:  no decent paying, if any, jobs for their population.  Not so Great Britain has been dealing with this problem thru the dole for nearly a hundred years. Spain is now feeling its effects, Italy, Portugal, the Eastern bloc, all have a front row seat to no employment.

Wealth distribution in that context is the least of their problems. They can't even find a job, and I'm certain that wealth building is the farthest thing from their hierarchy of needs. 

The biggest issue as I see it, is not wealth as much as it is survival. 

 

Sat, 03/22/2014 - 21:20 | 4581362 novictim
novictim's picture

Nice post.  But between my Aunt mounds and your human beans we are going to have to turn off our spell checkers!

That was such a huge point you brought up:  Productivity is now at so very high a trajectory in the aggregate that the need for people as workers will continue to decline.  Right now there is only one job for every three people looking for work.  Again, that is an aggregate estimate.

Yet profits are at an all time high.  Higher than ever in our history.

What will we say when the ratio of [people to jobs is 5:1?  or 10:1?  

When do we need to admit that a new social contract is in order?

I wish we all could face these facts and their implications.  

Sun, 03/23/2014 - 07:49 | 4582010 Comte d'herblay
Comte d'herblay's picture

"When do we need to admit that a new social contract is in order"?

 

Actually the social contract is already surrendering to an updated version.  You cannot have 45% of the people not working, yet surviving without it. And some quite well with all the transfer payments being made.  The so-called poor who have reproduced at a factor of 7 to 1 whites in the Hispanic community, and the blacks at 4 to 1 whites, you have children dying in the streets if not for the social contract that keeps them eating and reproducing, going on 4 generations now. These poor should see what real poverty is in Caracas, Rio, and other cities that are in shanty countries for real poverty.

Likewise with what the FED is doing-----and this is where the conspiracy comes into play----without telling the people that this is what they are doing. They remain elite in their dissemination of information, providing it only to the Chosen, to trade on as they will, fully cognizant of their power to profit immensely with this kind of inside information.

I have been on the earth too long to be anything but cynical about absolute power as exemplified by the FED, and more particklerly, those men and women behind the FED telling it what to do and when.  

In Vonnegut's society the people demanded a halt to technological advances and a reversal of its 'benefits', i.e. the buggy whip maker wanted the machinery that makes buggy whips destroyed so he could go back to making them by hand.

An unlikely scenario today. We are about 30 yrs, a generation or so, away from the institution of National Incomes, forget minimum wage, for everyone.   It's the only way that people will be able to get on with whatever they are going to do with their time. 

Barring Nukular conflagrations in multiple countries to reset the population back to manageable numbers, there is only one way to stop people from not only turning on the rulers, but each other. 

I'm not in favor of cannibalism. I doubt many of my compadres are either.

Sat, 03/22/2014 - 22:47 | 4581548 chindit13
chindit13's picture

At the dead or dying end of this thread, finally there is something with which I can agree. 

The foundation upon which I view events is quite different from the prevailing view on this site.  Where most here see something between malice aforethought and outright conspiracy, I view events starting with the assumption of incompetence at all levels of authority.  It is simpler, and it is what my own experience has taught me.  Granted incompetence is not as sexy as conspiracy, and would never generate as many clicks, but it is what it is.

Anyone who actually took the time to read all of what Fisher said understands that there is a little quote mining at play in Tyler’s article.  Looking through the comments shows that it achieved its intended effect.  Can’t fault Tyler for trying to make a living, I guess.

Fisher did not mean QE was specifically intended to boost the elite.  QE was intended to create a general wealth effect society-wide.  That wealth effect would come from higher asset prices.  Those assets include, among other things, people’s residences, their 401Ks and their company pensions.  Where the “gift” enters into it is that the 1% by definition own a sizable amount of assets.

Incompetence enters into it because the Fed members failed to appreciate just how skewed asset ownership is.  I suppose they also knew that the mechanism of implementation would benefit a select few (primary dealers), but I suspect that was considered more serendipity than anything else, as it would help recapitalize the banks, who might then be motivated to make loans to home, car, or bass boat buyers.   Behind this failure is the academic arrogance that had Bernanke stating such things as that the financial crisis wouldn’t move beyond subprime, and that RE values had never fallen simultaneously across the entire country (and thus wouldn’t as a result of the debt problem).  He never had a clear view of even one second into the future.

While Bernanke et al are full of themselves and think that their models are superior to empiricism, they also need or seek validation.  Thus when a Jamie or Lloyd tells them that QE is the right thing (because Jamie and Lloyd are market-savvy enough to know what the effect of QE would be for them), Bernanke received his validation.  In addition, Bernanke creates models that prove his models work, which is intellectually bankrupt, but fits in with his arrogance and incompetence.   I doubt he ever even considered that 99% of QE would end up merely as Excess Reserves, and that the rest of the money would be used not for loans, but for trying to corner the CDX IG-9 market.

Now two more things enter into the big picture.  One was stated beautifully by "novictim" above, where he says Bernanke thought the problem could be solved with increased production when the problem was actually demand---or consumption-ability---related.  Again, that is incompetence.

The other factor is what you note in your comment: how to provide a meaningful existence for all 7 billion of us.  In my opinion THAT is the core problem.  Our species has become wildly efficient in terms of production.  We have exceeded our ability to absorb the redundant.  I view the entire debt problem as a symptom.  Debt was the way we created demand-ability.  Because we could produce too much, we did produce too much, but in order to absorb that production---when fewer paid workers were required to produce it---we made debt easier to obtain.  We added a third income to American households in the form of home equity.  Debt was a stopgap measure, but it created its own problem.  It also was fertile ground for the self-serving and the opportunists, which is why and how we ended up going all the way to Peak Stupidity as best exemplified by Cherry-Picked Synthetic CDO Squareds with CDS Kickers.

None of that, however, even if the debt bubble could be deflated with minimal pain (which it cannot) solves the underlying and perhaps intractable problem:  what is everyone going to do with their 80+ years when most of us are unnecessary?

For that, there is no good answer.  Sadly “nature”, other in the form of Mother Earth or human nature, tends to solve such problems by culling the herd.

 

 

Sun, 03/23/2014 - 02:54 | 4581849 Mediocritas
Mediocritas's picture

+1 for human incompetence. It's a shame all these good threads become needles in a growing haystack over time.

Don't agree on the motivations for QE though, I think you're assigning too much competence to Bernanke. When the Fed first brought QE into play, they were playing defense not offense, more concerned about preventing asset prices falling ("poverty effect") than boosting them up ("wealth effect"). Babies were being thrown out with the bathwater as firms found themselves having to liquidate anything marketable, even the highest quality assets (including TSYs) to raise cash that would fill the black holes being left on balance sheets by unmarketable assets.

The Fed panicked and took what it thought was the most sensible option at the time, providing liquidity in the form of reserves in exchange for unmarketable, illiquid "assets", and taking up the missing bid on TSYs. Had agency purchases all been done as repos then it would all be more palateable, but they didn't think of that or didn't have time (incompetence).

Talk of the "wealth effect" and other such nonsense came later as they attempted to justify their actions and tweak the QE technique, focusing more in TSYs with QE2, then realizing they fucked up shadow banking's preferred collateral source and had to twist into longer dated paper. All the blah, blah simply helped them avoid making an admission along the lines of: "oh we just gifted megabanks and GSE's a few hundred $billion in exchange for utterly worthless piece-of-shit assets that will never recover value and need to be written off slowly over time with the loss covered by taxation (via profits from TSY holdings amongst other channels), because we panicked and didn't know what else to do".

Like you, I prefer to default to "incompetence" rather than "conspiracy" as an explanation because it's usually correct but when I see that the FIRE sector is not being asked to pay for the losses it caused, but the rest of the economy is, when global financialization is increasing rather than decreasing, even in the aftermath of a crisis, then it's pretty clear that banksters are conspiring to control in their own favor. I'm calling conspiracy in which the participants are incompetent humans.

---

Back on the topic of too many people and the economics of it, now that's a fine thing to talk about, so much so that I've been discussing it back and forth for 20+ years! Here's the conclusion of one such thread back in 1999 by Jay Hanson: http://www.warsocialism.com/unnecessary.htm I have my own ideas, different from Jay's, but many are shared.

Sun, 03/23/2014 - 06:23 | 4581953 chindit13
chindit13's picture

Maybe it's semantics, but I agree with you.  The first goal was to stop asset price collapse, as you stated.  After that, I believe, came the goal of creating a new wealth effect.  The unequal distribution of asset ownership, coupled with QE, has set us on a path that is beginning to approximate the Middle Ages: serfs and lords (e.g., Blackstone and rental home tenants).  One place where I an get myself in a tizzy is when I consider that it was the availability of debt that allowed the common man to become an asset owner to a greater extent than any time in human history, but that debt tends to get abused, and it can become just serfdom in another form.

As for the semantics part, I don't call the bailouts a conspiracy.  What it is is business as usual.  Wealth, in a democracy, obviates the one man, one vote thing.  Elected leaders tend to be for sale.  I'm not sure there is a way around it.  Even if the Fourth Estate did its job, they still need an audience, and that audience must be an active citizenry who believes it has civic responsiblities.  Term limits might help, but again, any such change would require a referendum; Congress is unlikely to do it on its own.

Regarding the article you noted, since I am a firm believer in the innate corruptibility of most all humans (plus everyone's occasional dip into incompetence), I simply cannot see any way that an "expert body" can fairly dictate the rules of behavior for the masses.  Benign dictators existed only in Camelot.  Democratically elected leaders can be bad enough, but at least they are theoretically answerable to the governed.

Let me jump around further (but prompted by your linked article) and say that another question I always have is what might be a fair allocation of resources?  What does that mean, even if it were achievable?  A distribution by country or by individual?  If by individual, does that favor the irresponsibly fertile?  And do he developed have to sit around and wait for the developing to rech a level where they have a use for resources?  What about the person who chooses not to reproduce?  Since he or she will not set off a chain of events that leads to hundreds or thousands of future resource users, can the non-reproducer get a bonus allocation?  I just don't know the answers.

Sun, 03/23/2014 - 13:27 | 4582639 Mediocritas
Mediocritas's picture

I also believe that humans are innately corruptible and incompetent. It's just a component of our DNA, that we evolved to abuse power if we have it, as this creates a survival advantage and higher probability of breeding success. If our ancestors didn't behave this way then we wouldn't be here, simple as that. Evolution selected for assholes, which is what we all are to various extents.

Although I like the gist of Jay's suggestions, I think he leans to heavily on expert panels with little in place to prevent corruption of those panels. My own proposed solution is a democracy in which there are no politicians. Nobody to elect, no panels, nobody for lobbyists to corrupt, just a government staff that has to do what it's told and is fired when non compliant. Such a system was impossible before the internet, but now it's just a small programming effort away, should someone take an interest. I call it "Netsensus".

:: Legislative ::

  • no politicans, no parties. Instead citizens vote (simple red/green arrows) for policies.
  • no terms. Policy voting is dynamic. A citizen can change their vote any time they choose.
  • policy adoption requires a minimum % participation of voters.
  • policy adoption requires a clear majority (say 66%)
  • policy flipping requires a clear shift to the opposite direction (say 33% from 66%). The buffer prevents thrashing.
  • votes are weighted by expertise. It is ridiculous that 1 person = 1 vote when one person is an expert and the other is not. Nobody goes to the baker for surgical advice, rather the surgeons opinion is considered more important. Calculating this is complex but it's a similar problem that Google solved with PageRank. Some sort of social network would be needed to automatically assign weighting based on the policy theme. By default, a person's vote is always 1, but if the topic is something they are educated in then their weight on that vote is increased. Smarter people than me could figure this out.
  • disinterested citizens can assign their voting power to a representative organization (equivalent of a political party) that will make decisions on their behalf however the weighting of the delegated vote will be reduced by a large amount (say 95%).
  • active participants will be a small amount of money for casting a vote (in any direction), thereby incentivizing citizens to participate in their own governance and creating a use for welfare bums (make them work on their country to earn it).
  • policy propositions must contain only one core concept per policy (no dodgy amendments to sneak through unrelated crap). The policy must be explained fully within a 3 minute video and one page of text.
  • anyone can propose a policy, but it must achieve a certain "green light" level of voting participation to be advertised broadly. Much like reddit or digg.
  • all active voting topics have one pro-column and one anti-column. Each column is headlined by a 3 minute video outlining the case and a single page of text. Each "side" of the debate is permitted two responses to the other side with the initiator having the final say. Members of each side may upvote or downvote the content creation process leading up to a formal statement thereby ensuring that the most popular, (best crafted) responses are published.
  • when casting a vote, a participant is required to first pass a short multi-choice examination to prove that they have indeed studied the arguments of both parties in the debate. Each party chooses half of the questions, which are voted on in advance by members during the content creation phase. 5 questions each should be enough. This is intended to prevent donkey voting simply for the $s. Failure to pass prevents a vote being cast for 1 hour.

:: Fiscal ::

  • spending is decided by participants. Using a GUI similar to this: http://www.timeplots.com/collections/catalog/products/death-and-taxes-po... or this http://lh5.ggpht.com/-3-_elKaJPHw/URSRETrTDjI/AAAAAAAAcdY/qANmVbnlmeE/im... or a simple tree structure. Users drag and drop to set their %'s, the weightings for where they think dollars should go. How far they want to drill down into the details is up to them but most people would only bother to allocate for broad categories such as health, education, defense and welfare.
  • citizens are paid a small amount for going to the trouble of allocating %'s for spending of tax revenues. The greater detail they provide, the more they are paid. This can be changed at any time as circumstances change.
  • like voting, citizens can delegate spending decisions to a third party (or apply a third party template), but in doing so, the weighting of their contribution will be reduced. This will be achieved by only allocating a small percentage of their taxes paid (say 10%) in accordance with the third party allocation, with the remainder reverting to default distribution.
  • unallocated money (including that divested due to being lazy and adopting a third party template) will be allocated automatically in accordance with the weightings of the current global allocation. (Or be parked in a trust / reserve for future allocation).

:: Monetary ::

  • electronic money only, all transactions must be digital, meaning no cash can escape the accounting system (unless converted to a different form, such as gold, which is not recognized as currency directly so is irrelevant, ie, hoard in some other medium than the currency). Overseas holders of the national currency must have an electronic account visible to the domestic monetary system, subject to the same regulation.
  • inflation, as a means to prevent money hoarding and maintain velocity, is outlawed as it simply cannot produce stable prices (only stable price rises), and always benefits those closer to the inflation source disproportionately. Instead, deposits (and debts) are "clipped" at a variable % rate each day (which could be negative if need be) in an automatic manner to ensure actual price stability. The clipping rate depends upon the size of the current account deficit and the amount of credit creation and may be zero, or even negative (adding money to accounts) where necessary (more below).
  • each citizen has an accumulated debt limit that cannot be breached. The level may be automatically altered depending on what the economy requires. Like deposits, debts are automatically clipped each day (both are reduced), so that debts and credits converge to zero over time. Citizens may pool their debt limits to buy a more expensive asset (see credit unions below).
  • usury is restricted (compounding debt is outlawed), but for profit lending/credit unions are permitted provided the final repayment amount is stated upfront (rather than calculated using compound interest over time). A contributor to a lending union runs up to their own debt limit to contribute to the union fund (that is then borrowed from by debtors). When a citizens goes over their personal credit limit thanks to the use of a credit union, then the excess is not clipped, nor is the credit limit of the contributors to the fund.
  • when a citizen is in credit (with clipping reducing their holdings over time), their debt limit is increased in direct proportion to the clipping of their credit. For example, if a citizen has a debt limit of $100k and a current deposit of $50k, then the clipping of their $50k over time would eventually give them a debt limit of $150k. Thus credit-worthiness is automatically assigned by the system based on a proven ability to accumulate savings.
  • when a citizen is in debt (with clipping reducing the debt over time), their debt limit is reduced also with the clipping. For example, if a citizen runs up debt to the limit (say $100k), then does nothing to pay that debt down and simply lets it clip away to, say $50k, then their debt limit will have also been clipped to $50k. A citizen who contributes to debt repayment will only see their debt limit clipped by the automatic amount during the time they take to repay, then will see their debt limit again increase once repayment is in full and savings begin.
  • a safety net is provided by a minimum debt limit and minimum credit limit between which no clipping can reduce the limit (although the amount is still clipped). For example, a bum could run up a $100k debt then do nothing to pay it off. It would subsequently clip all the way back to $0 over time, taking the debt limit with it, but once the debt limit hit the safety net (say $10k) then it would stop. The bum would then be limited to no more than $10k debt and would have to live off the clipping rate from that point on. (The clipping rate is a form of welfare if you will).
  • net citizen debt limits will be altered depending on the state of the current account. If a large amount of $s are being held in foreign-flagged accounts (ie, not being circulated domestically), then debt limits will be reduced (and vice versa).

:: Other ::

  • child benefits are reduced with each subsequent child. Beyond 2 children, zero benefits / tax breaks are paid.
  • taxation is not applied on incomes (capital or labor), goods or services, unless it is to pay for costly externalities of those processes. For example, a tax on petrol consumption to pay for pollution clean-up.
  • the dominant form of taxation is land-tax to prevent land-hoarding which restricts supply and artificially raises shelter prices, hence debt. This also encourages optimal use of land in capital formation enterprises as land-banking is unprofitable due to the tax burden (let someone else who can use the land productively take it). 
  • asset taxes may be imposed where hoarding is detected as hoarding prevents the hoarded resource from being utilized productively by others. In these cases, taxation is a net economic positive.

I think you'll see the common theme in all of this. Front and center is my belief that humans are deeply flawed creatures so I have tried to think of systems that negate the flaws. The greatest evil in human history comes about when great power is allowed to accumulate in the hands of a few (and seeing as knowledge and money also entail power then neither of these shall be allowed to accumulate greatly in the hands of a few either).

The only system that works is one in which power is distributed and that's democracy, but democracy only works when people participate which means understanding the issues in play and giving enough of a shit to get involved in the debate. Seeing as money is power, citizens must have more than just a say in what laws are being decided upon, they must also have an active say in where their own money goes.

Political parties cannot possibly represent the multi-faceted views of individuals, instead individuals must be allowed to express all of their idiosyncracies fully, via such a system, if they are to be motivated enough to like the system and want to participate.

Anyway, that's my two cents after 20+ years of thinking about it. Plenty to criticize, but also plenty to work with I think.

Mon, 03/24/2014 - 04:56 | 4584719 chindit13
chindit13's picture

Thanks for posting that.  Things to mull over.

By the way, there are a few folks here I have followed from when they first arrived.  I've always enjoyed reading your posts.

Mon, 03/24/2014 - 08:04 | 4584842 Comte d'herblay
Comte d'herblay's picture

You say you want a revolution.....your comprehensive and detailed system is nothing less.

I am reminded that when a politician wants to appear to solve a problem (but in reality wants to perpetuate it for nefarious reasons) e.g. the Justice Department's failure to investigate Banking Fraud by the likes of Lord Blankfein, and John Mack, what she will do is propose to throw out the entire banking system as it now exists under the pretense that the banks have been allowed for too long to run unobstructed, unregulated, and rampant. She will conveniently ignore the fact that there are a great many regulations already in the code, and there are watchdogs that however inefficiently run, or corrupted, neverthess do exist. 

So instead of setting her sights on one or two of the most egregious violations of existing law, or reforming one aspect of the existing law, in order to maintain the status quo, she assures the failure of the all-inclusive Bill she is proposing.

Ditto with "Gun Control".   All the attempts to have the Federal Government 'control' weapons conveniently ignore the fact that 300,000,000 guns are already in circulation, nearly all of them subject to so many laws, that the only conclusion one can draw from this is that those running for office on a Gun Control platform are merely inflammatory propaganda to secure left wing votes. The barn door is closed to "Gun Control" and has been for 50 yrs. But it makes good headlines.

So too with your extremely well thought out program for governance.  Instead of taking two of the most influential and detrimental parts of government, say Term Limits, and 'Edudoctrination' , and setting to work reforming them only, and not resting until they are accomplished, you doom your entire ystem to failure by being a 'garden snake thinking it's a python, attempting to swallow a pig. All that happens is the snake may choke. The pig remains alive and well. 

From what has happened in the Unites States since 1865, it is clear that South Carolina had it right all along as did the rest of the southern and western states that wished to secede. Lincoln was dead wrong to stop that, and killing and maiming hundreds of thousands, along with Jeff Davis taking to ruins, decent cities.  

The real problem is the United States has become that horrid creation:  Too Big Too Fail as our plutocrats have done with the 12 primary dealers. This is utterly false, but accepted as great wisdom, a trojan horse.  

If the U.S. had not formed one union, this part of the North American continent could well be a dozen different countries with a dozen different or similar forms of governance, and still a great power in the world.  All of our differences could have by now been allowed to flourish and from that experiment I believe fairer, more just and dynamically more responsive nation states would exist, diversified, immune to the 'clonal' disasters that have befallen us.  Certainly light years ahead of what passes for a so-called nation that in substance is already divided, ungovernable but by dictated nostrums from a powermad senate committee chairman or executive order that few agree with other than the few who benefit from the fake unification. 

It's long past time for dissolution of America in reality to reflect it's de facto unbridgable divide. 

That too, is of course a pig in a garden snake.

 

Mon, 03/24/2014 - 08:38 | 4584901 Mediocritas
Mediocritas's picture

I failed to mention that I'd never expect to see something like this tried in an existing significant nation. Hell, the USA hasn't even broadly adopted the metric system and I still remember trading in fractions. Some things are just too big to change, too much legacy code to ever refactor without throwing the whole thing out, starting over, and ruining the entire business in the process.

I get your point perfectly well because I'm a software engineer with plenty of projects under the belt (many of them failures). Working on large projects, full of awkward legacy code, every engineer dreams of ditching the entire codebase, starting over and doing it properly. Veterans know from experience that this simply isn't feasible and that a whole lot of that legacy "crap" exists for very good reasons that have long since been forgotten (and were never properly documented).

If the urge to start fresh can't be beaten back, then the only sensible option is to bust out with a small, disciplined and motivated team and try one's luck in a startup knowing that it's highly likely to fail. Such is life, but it's the few success stories that really do end up changing the world in a way that refactoring dinosaurs never can. In other words, an evolved / improved governmental system will not come out of the USA, it will emerge from an unexpected place like Africa or Eastern Europe.

Sat, 03/22/2014 - 13:18 | 4580475 kellycriterion
kellycriterion's picture

Where does the "real", the cumulative crowding out fit in? When you reorganize for less individual action and voluntary interactions to more coercive and force action do you expect results to be the same? Do you expect the old measurements to apply? More corruption, more prioritization according to politics, the literal constriction of thought.

Sat, 03/22/2014 - 13:44 | 4580522 novictim
novictim's picture

"When you reorganize for less individual action..." you can sometimes end up like CHina with double digit growth for 2 decades.

That is the effect of a command economy...SOMETIMES.  But it is a tool that can lead to everything you said as well.  In the 1930-50s we used the state to direct labor and build the interstate highway system, hydroelectric dams, public monuments, etc...we expanded the national parks under several Republican presidents and we now see these as wise investments.  

Later, we pulled back which was appropriate.  But now we need that command economy direction.  That is my opinion.

Sat, 03/22/2014 - 12:37 | 4580398 22winmag
22winmag's picture

Hang 'em high!

Sat, 03/22/2014 - 12:44 | 4580412 kikk
kikk's picture

The BoE are no different. We have a situation in the UK where 5 families own more than the poorest 20%. that's 12.6 million people

http://www.theguardian.com/business/2014/mar/17/oxfam-report-scale-britain-growing-financial-inequality

Sat, 03/22/2014 - 13:34 | 4580506 Herdee
Herdee's picture

Inflation is supposed to create jobs according to all the Keynesian teachings.Just increase the money supply,it's that easy they say.The only trouble with that is the severe structural problems in the economy.With defense spending contributing to 50% of the jobs in U.S. society you can see why the U.S. is more dependant on ever increasing frequency of war.I remember when people used to joke around saying " I guess the U.S. just needed another war to keep them going."Turns out that now the neo-cons are desperate now for another one.They got snookered on Syria so now they are trying for Ukraine which is a very poorly thought out strategy on Russia's doorstep.Trying to take on the Russian Army next door to a nuclear armed nation is just plain dumb.It's like Russia overthrowing Mexico in order to get at the U.S.Russia already has the secret weapon anyways.That weapon is very simple according to Jim Sinclair(you can go to his site),they only have to dump the rest of their Treasury holdings in order to prop up the Ruble and remove themselves from the swift system and take oil payments in any currency other than U.S. Dollars.Next the confiscation of all western assets in Russia will hit and bring down the stock market into the cellar.That amount of money is not going to be recycled into the U.S. Dollar system and all of it seems to be coming up to the point of gold vs. paper.You'd see the Fed printing like crazy then,just to try to hold it up.That's the bottom line because when you think about it,gold has to be allowed to rise in order for inflation to take off.The U.S. Government one way or another will have to let gold rise.It's that or a deep deflationary scenario soon.But in the depression worsening cycle they'll have to create more inflation anyways.Politicians will take the easy hyper inflationary route because of corruption which is engrained into the political Washington scene.Trouble is,they have to destroy the Dollar to do it.Gold will win out.Already,we're seeing the fantastic move in the grains.Look at them on Inside Futures site or look at the symbols JJG, SOYB & CORN. 

Sat, 03/22/2014 - 17:46 | 4580922 novictim
novictim's picture

Inflation is considered to correlate with job creation in neoClassical economics as well.

Don't mix Dictums with Observations.  Austrian economics has different dictums than Keynesian economics but observations are just that...observations.

Sat, 03/22/2014 - 13:57 | 4580542 yogibear
yogibear's picture

"Inflation is supposed to create jobs according to all the Keynesian teachings."

Ben Benanke, Glen Hubbard, Charles Evans all polluted all those young minds sitting in the economics courses listening and following garbage.  

Sat, 03/22/2014 - 17:49 | 4580924 novictim
novictim's picture

You know that Bernanke is of the Chicago school, right?  

Bernanke is not a Keynesian.  It's oft repeated here that he is but lies and stupidity abound here.

Sat, 03/22/2014 - 14:12 | 4580555 Uncle Remus
Uncle Remus's picture

That last chart needs Ruger, S&W et al.

Sat, 03/22/2014 - 15:24 | 4580680 Doom and Dust
Doom and Dust's picture

Like all you hapless goyim, I'm waiting for the jew to call bullshit on his own tribe, then mobilize us to play the other side.

Nothing ever changes.

Sat, 03/22/2014 - 16:20 | 4580786 Pike Bishop
Pike Bishop's picture

"We wonder how President Obama, that crusader for fairness, equality and all time Russell 200,000 highs, will feel about that?"

The same way he always has.

He always lacked the conviction of his convictions. They became his "preferences", while he pushed responsibility for them onto everybody else. Then climbed to his Statesman Tower from which he would speak only of "realistic " expectations, and tout spectacular concessions . The swift white flag, which was always the signal the 99% were about to get another ass-refreshing enema.

Erring towards his Political Donor Class, Chimpy McFlightsuit's foreign policy, Shooter McBangBang's Police State, and the Fed's Excess Bravuro.... were always a matter of the fucking most convenience, and great-looking expediency.

The ever-present Centrist (which is a political tactic, not a political ideology or platform) never wanted to stand-for or win anything,.. but a campaign race to pile-up the most bullshit promises.

Actually accomplishing something was merely his preference.

His universally favorite fallback position was to make himself look good.

No matter how pathetic the reality was.

Sat, 03/22/2014 - 17:33 | 4580895 novictim
novictim's picture

Speaking of growth and the advantage of Trickle Down economics, it seems to me that when you should pursue or pull-back on this policy is never very clear in the moment. Like in the 1910s-1920s, the economy had made HUGE changes and needed to cool down so as to avoid the 1929 crash. A period of incorporation and leveling was needed, not more policies to fuel excess wealth inequality and a bubble economy.

The crash was repeated in 2008 where we can see, in hind sight, a similar lead up of inequality and wealth misappropriated toward speculation/gambling.

In the early 2000s when our economy was shifting to new industries of personal computers and highly automated systems, a trickle down approach worked well. Business had the fuel needed to expand into new technologies. The "Peace Dividend" helped to drive this shift as well and money that was accumulated was spent wisely. Yet, by 2005 the market needed a pause and the economy needed to resettle...and that need for a cool down and re-calibration was never addressed and so we later had the 2008 crash.

Shouldn't policy makers learn from these patterns? If we pursue easy money policy and QE and instead of getting increased spending on new means of production (new equipment, new factories, new tech, new hiring) you get increased speculative spending and asset bubbles then this should be a trigger for policy makers to put on the breaks and look for ways to level out the system and deflate wealth accumulation.

Ok, now down vote me (;->)

Sat, 03/22/2014 - 17:43 | 4580918 novictim
novictim's picture

Edit has stopped working...meant to say Early 1990s not early 2000s

Sat, 03/22/2014 - 17:37 | 4580896 novictim
novictim's picture

System error!

Sat, 03/22/2014 - 17:37 | 4580908 q99x2
q99x2's picture

Levinworth Valley Mental Hospital. I've heard of that.

Sat, 03/22/2014 - 17:47 | 4580923 BullyBearish
BullyBearish's picture

Even people in positions of power do things for only two reasons: because they can or because they have to.  They did QE because they could, now they taper because they have to...which they will turn into a "because we can".

Sat, 03/22/2014 - 18:03 | 4580944 novictim
novictim's picture

Regarding INFLATION and JOB CREATION:

A man comes up to you and says "Ok, bub.  I want you to use that money of yours on creating more wealth and employment or I'm going to take that money away at $100 dollars per day!"  

...and so, fearing money loss, you go out and spend that money to expand your business and you hire more workers.

That is how inflation works.

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