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Federal Reserve Admits It Has NO IDEA What It’s Doing
AP reports today:
Federal Reserve Chair Janet Yellen is stressing the need to review the unconventional monetary policies that central banks around the world deployed in response to the 2008 global financial crisis.
She said Thursday that the post-crisis period offers policymakers an opportunity to assess the effectiveness of the tools and better understand the impact of new regulation.
“Policymakers have to carefully weigh the advantages and disadvantages of alternative monetary implementation frameworks in the presence of new policy tools,” Yellen said in remarks at a two-day research conference sponsored by the Fed.
Translation: We have no idea what’s going on, or whether or policies are helping or making things worse.
Also today, St. Louis Fed Chairman James Bullard said (via Zero Hedge):
The Fed “may need to alter some fundamental assumptions about how Fed policy works if U.S. stays in persistent state of low nominal rates, low inflation.”
***
But the most important thing Bullard said in his speech titled “Permazero” is that the the US may be entering a permanent period of lower inflation and interest rates. Wait, wasn’t ZIRP and QE supposed to push the US economy, boost inflation and hike rates?Good to know 7 years later that the biggest monetary experiment in history did precisely the opposite of what it was supposed to achieve.
We've noted for over 7 years that the Federal Reserve has no idea what it's doing.
For many years, the world’s most prestigious financial institution, known as the “Central Banks’ Central Bank” – the Bank for International Settlements – has slammed the Fed’s policies of:
- Letting big banks hide their debt, instead of making them write it off
- Propping up too big to fail banks
- Leaving interest rates too low for too long
- Blowing bubbles
- Using “gimmicks” and “palliatives” to try to paper over the mess
Indeed, one the Fed’s core tools – quantitative easing – which is aimed at boosting inflation, may actually CAUSE deflation.
Another core tool – creating a “wealth effect” – actually HARMS the broader economy in the long run.
Heck of a job …
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a rare bad post from george. They know exactly what they are doing, bailing out rich and trying to cause inflation. Obviously not going to say that they crashed economy on purpose so Yellen is using the playing dumb defense.
What do you think fed reserve's purpose has been all along, and why do you think they crashed economy on purpose back in Andrew Jackson's days?
I'd suggest the FED buy a book or two about Austrian Economics, and put it to work.
“Keynes did not teach us how to perform the ‘miracle of turning a stone into bread’ but the not-at-all miraculous procedure of eating the seed corn.” – Mises
http://www.voicesofliberty.com/article/a-beginners-guide-to-austrian-eco...
https://en.wikipedia.org/wiki/Austrian_School
need actual keynes and I don't mean tax cuts for the rich or bailouts for them either.
in a post yesterday it was noted that the last several times the fed raised rates the longer term yields dropped and the curve inverted. now if short terms rate go negative how is that going to work out? is the whole curve going underwater? nice policy you folks have there.
in a fiat regime it is an accomplishment to keep interest
or interest rates at all, never mind positive
or negative. at the onset they are telling you
you do not matter; so, i mean, who cares?
hence, bread and circuses of subprime quality.
there is no reviving branch off their trunk or
stem/system of usury.
Boosting "information"? I believe it's supposed to be "inflation".
Most PEOPLE have no idea what the FED is doing.
The FED knows EXACTLY what it is doing.
"Federal Reserve Admits It Has NO IDEA What It’s Doing"
yeah, right
A long rope and a short drop will fix these minor problems......
Rope is handy and very effective. Hemp rope seems fitting.
And it can be recycled. Many times.
they know what they are doing.
""Behind the ostensible Government sits enthroned an invisible Government, owing no allegiance and acknowledging no responsibility to the people. To destroy this invisible Government, to dissolve the unholy alliance between corrupt business and corrupt politics, is the first task of the statesmanship of the day."
Theodore Roosevelt, The Progressive Platform
"As societies grow decadent, the language grows decadent, too. Words are used to disguise, not to illuminate, action: you liberate a city by destroying it. Words are to confuse, so that at election time people will solemnly vote against their own interests...
Any individual who is able to raise enough money to be considered presidential is not going to be much use to the people at large. He will represent whatever moneyed entities are paying for him. Hence, the sense of despair throughout the land as incomes fall, businesses fail and there is no redress."
Gore Vidal, The Decline and Fall of the American Empire, 1992
"Last year, pressed by progressive donors at a dinner party to act more like the progressive they thought he was, Obama responded sharply, 'Don’t you remember what happened to Dr. King?'”
Ray McGovern, Doubting Obama's Resolve To Do Right" jca
10 NOVEMBER 2015
Deep State at Home and Abroad: Mike Lofgren and David Talbot.
http://jessescrossroadscafe.blogspot.com/2015/11/deep-state-at-home-and-...
I want to know how truthful is the quote that Obama said: “Don’t you remember what happened to Dr. King?”
Did he actually say that, is McGovern correct, if true it is first time I saw the veil falling from where wizard of oz does his work with Obama if you know what I mean. It's cowardly for Obama to say but at least it is truthful. Similar to Ike warning us about the MIC . . . on his way out when he no longer had power to do anything about it . . . truthful yet cowardly. Though Dwight did it on live TV, can't deny it unlike where Obama allegedly said it to his rich donors and McGovern reported on it with no proof.
Thanks fvor the link. The Bill Moyers clip interviewing Mike Lofgren on the Deep State was excellent.
https://www.youtube.com/watch?v=EYS647HTgks
They are bypolar. Smart as can be right up till the bill comes due. Then its dine and dash time.
Thats MMT in a nutshell.