Progressive American Think Tank Begs Bernanke To Bail Out Spain

Tyler Durden's picture




 

It's one thing for liberals to demand one group of Americans pay for another group of Americans, with a third group's money of course (until it runs out), but when a progressive think tank actually has the temerity to tell Bernanke that Europe is not socialist enough, and thus needs liberal US support, that's when things just get plain old silly. Which incidentally, is precisely what the progressive brains of Mark Weisbrot and Dean Baker, co-directors of the liberal Center for Economic and Policy Research, have done. Naturally, we are all for a humanistic effort; we also believe in leading by example. If Messrs. Weisbrot and Baker would first be kind enough to divest themselves of all their earthly possessions and bank account contents, which should be Fedexed and wired in the direction of Spain post haste, it would make their transparently theatrical pursuit of pseudo-noble causes just that more palatable to the masses who already are on the verge of poverty, and are now being asked to bail out other countries. 

Just released from the CEPR

European Central Bank’s Inaction Could be Costly to U.S. and World Economy

 

Washington, DC– Center for Economic and Policy Research (CEPR) Co-Directors Dean Baker and Mark Weisbrot issued the following statement today, calling for action by the U.S. Federal Reserve to contain the eurozone crisis. Weisbrot just returned from Spain, where he observed the impact of the crisis firsthand.

 

The statement reads:

 

“The financial crisis in the eurozone, now centered on Spain, is contributing to the slowdown in the U.S. economy and opens the possibility of a worse financial meltdown, of the type that followed the collapse of Lehman Brothers in 2008.  This could tip the U.S. economy into recession.

 

“The European Central Bank (ECB) could put an end to the acute crisis by intervening in the Spanish bond market, as it has done in the past year, thereby stopping financial markets from driving these bond yields to levels at which Spain’s debt is seen as unsustainable.  But it has so far refused to do so.

 

“The Financial Times reported yesterday that ‘A widespread view within the [ECB’s governing] council’ is that prior interventions ‘simply reduced the incentive for governments to act;’ and that ‘the ECB also has to judge whether to take pre-emptive steps to prevent the situation spinning out of control at the risk of lowering the pressure for political reform or wait to see how events pan out before responding.’

 

“The ECB’s refusal to act, for political reasons, is reckless and inexcusable.  Since the eurozone crisis is affecting unemployment in the United States, and threatens to raise it further, it is within the Fed’s mandate to act in this situation.

 

“Past interventions by the ECB indicate that the amount of intervention would be relatively little.  According to press reports, the Fed is currently considering an additional $700 billion of quantitative easing in the United States; the amount necessary for intervention in the Spanish bond market would be a small fraction of this, and possibly have more impact on the U.S. economy.  Past actions indicate that private investors would move quickly to buy Spanish bonds on the heels of a central bank intervention.  Furthermore, the intervention would come at no cost to the U.S. taxpayer, and the Fed would accumulate foreign assets in its reserve holdings.

 

“U.S. Treasury rates fell to all-time record lows last week, as fear seized financial markets worldwide.  More than $100 billion left Spain in the first quarter of this year – nearly 10 percent of Spain’s GDP – and it is likely that capital flight accelerated in April and May.  This capital flight worsens the situation of the Spanish banks, as does the fall in the price of Spanish bonds, which are held mostly in Spain. All of this makes the banking and financial crisis worse.  The eurozone recession is deepening, and the financial crisis there is affecting many parts of the world economy.

 

“It is possible that action by the Fed would also cause the ECB to intervene. But in any case, it is within the Fed’s mandate and ability to contain this crisis.  It should act quickly before there is further damage to the U.S. economy.

 

“Other central banks with large reserve holdings may also want to consider intervening as well, if the Fed does not act, or in conjunction with the Fed if it does.”

So... it is within the Fed's "mandate and ability to contain" the European crisis? No, really, you just read that.

And by the way, just because there are idiots who believe this is sound policy, does not mean in won't happen. Of course the Fed will "rescue" Europe (if only for a few months). But not before the market is one towering inferno of 201(k) statements, and the S&P 500 has officially been rebranded the S&P 200 (and the XO is over 1000 bps). Only then will Bernanke reprise his November 30 global bailout and unleash more US taxpayer money loose in Europe.

Because this time it will be different.

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Mon, 06/04/2012 - 14:03 | 2492717 digitlman
digitlman's picture

No more bailouts.

Mon, 06/04/2012 - 14:05 | 2492726 easypoints
easypoints's picture

No, do it. The more Ben Bucks out there, the shinier my stack gets.

Mon, 06/04/2012 - 14:08 | 2492730 Ahmeexnal
Ahmeexnal's picture

"AY, CARAMBA!"

 

small print on the bailout papers handed over to "king Juan Carlos": 

GOLD AS COLLATERAL, COMPADRE

Mon, 06/04/2012 - 14:11 | 2492753 MillionDollarBonus_
MillionDollarBonus_'s picture

Libertarians are bullies. They constantly pick on people who simply disagree that the Government and Federal Reserve are evil. They have no respect for peoples’ feelings. Progressives around the world need to stand up for each other, and comfort each other in the midst of this appalling abuse.

Mon, 06/04/2012 - 14:15 | 2492782 Dumpster Fire
Dumpster Fire's picture

You could cash out your FB killings and lend a hand.

Mon, 06/04/2012 - 14:18 | 2492794 Everybodys All ...
Everybodys All American's picture

how do you quantify 'feelings'?

Mon, 06/04/2012 - 14:21 | 2492802 t_kAyk
t_kAyk's picture

You sound depressed, better refill your hopium prescription. 

Mon, 06/04/2012 - 14:29 | 2492843 Bartanist
Bartanist's picture

Weren't you a conservative yesterday?

Are you just trying to make trouble?

Mon, 06/04/2012 - 14:31 | 2492850 Dr. Engali
Dr. Engali's picture

If only they were bullies then maybe there would be some push back againt the encroaching police state.

Mon, 06/04/2012 - 14:46 | 2492899 eclectic syncretist
eclectic syncretist's picture

The premise of the Federal Reserve is that it is a stand alone entity with infinite credit, and that it will supply or withdraw said credit as necessary to ensure stable prices and maximal employment.

What could go wrong?

Mon, 06/04/2012 - 14:57 | 2492948 smb12321
smb12321's picture

Why do folks insist that using someone else's money is somehow moral? One can make a case for intranational funding (ND taxes pay for IL fire fighters) but thereis absolutely zero obligation to throw away money on other nations - especially when their problems are of their own making. We are by far the most generous nation when natural disasters occur but this is entirely man made.

Mon, 06/04/2012 - 15:03 | 2492966 XitSam
XitSam's picture

Who took over your account? You used to be subtly clever, but now you're just boringly obnoxious.

Why should I be forced to pay for another's folly just to keep him from having bad feelings?

Mon, 06/04/2012 - 16:17 | 2493305 Bicycle Repairman
Bicycle Repairman's picture

The Greece bone is connected to the Spain bone.

The Spain bone is connected to the Euro bone.

The Euro bone is connected to the America bone.

And that's why they get bailed out by Bernanke.

Mon, 06/04/2012 - 17:09 | 2493542 Newsboy
Newsboy's picture

HURRY UP, BEN!

BANKER'S SALARIES AND BONUSES ARE IN DANGER!

Mon, 06/04/2012 - 18:51 | 2493903 piceridu
piceridu's picture

PS.
AND PLEASE, ON THE DOUBLE BEN, WE NEED TO KEEP OUR PHONY THINK TANK FUNDED SO WE CAN PAY OUR PHONY SALARIES, 5 STAR MEDICAL BENEFITS AND RETIRE WITH OUR PHONY PENSIONS INTACT.

Mon, 06/04/2012 - 17:16 | 2493559 Cadavre
Cadavre's picture

... of this appalling abuse.

You said "appalling" , he he - tacky attemp at skills beyond your current pay grade, but an almost acceptable placemnt of "appaling" in a 3 liner. You're getting close but no cigar - work a different part of the thesaurus for a while - see if it makes a difference to your love life - ya got nuthin to loose!

Tue, 06/05/2012 - 01:26 | 2494902 Bansters-in-my-...
Bansters-in-my- feces's picture

MBD....

Fuck YOU,you tool.

Mon, 06/04/2012 - 14:14 | 2492755 GetZeeGold
GetZeeGold's picture

 

 

Huh? That green thing isn't helping out Spain?

 

Mon, 06/04/2012 - 16:07 | 2493249 Cadavre
Cadavre's picture

So how exactly would the Bershkank bail Spain - understanding there are still 12 days of "hopium" left until the next (forgot the count) Greek Referendum, and now the gab is Spain?

Ben would buy EUR from the ECB with USD's, right? And then that money would be given to Spain with the provision that Spain can only use the money to buy McDonald Burger Stands, and Coke `a Cola vending machines, and then, from the tax revenues Spain gets from all their new Big Mac parlors and Coke vending machines will be used to halp Spain claw it's way back into the "black".

Hmmmm ... has that ever worked before? NOT!!!!

It seem all that Sapnish Bail would do is artificially increase the "apparent" demand for EUR, thus, pushing the EUR higher against the USD, followed by USD price inflation, which means the Stock Ponzi will get a slight bump and establish enough headroom for the monthly option expirations short squeeze. Next month Ben could do the same thing to Portugal, and the following month he'd save Italy and the USD will finally cost two Euros/per, thus boosting the markets to that sweet spot, and, thus, encourage the shabby sheik born in the USA Wal Mart elite to push the button for Oromney in November.

Is that it (again)?

Sounds complicated - Ben should just bail everybody out across the board - maybe Microsoft will hit 30 bucks again, thus covering Microsoft's expense for the fake security tickets it created for StuXnet and Flame (thought the CIA already paid M$ for that effort by Microsoft's Core OS Security Kernel shops in Israel),

Ben has a lot to more to worry about than Maurice's playing it loose at the bathhouse!

 

Mon, 06/04/2012 - 19:36 | 2494011 nmewn
nmewn's picture

"Huh? That green thing isn't helping out Spain?"

ROTFLMAO!!!

It turns out subsidizing unicorn farts here was just as disastrous...whocouldaknowed ;-)

Mon, 06/04/2012 - 14:07 | 2492739 t_kAyk
t_kAyk's picture

Thingamajigs for the whole fucking planet!!!

Mon, 06/04/2012 - 15:10 | 2492988 Matt
Matt's picture

Only $21 Trillion to give a check for $3000 to every single human being. Just have the money on an electronic card that can only be spent in America (or American websites that pay taxes in America) on Certified Made in America goods.

This plan will help developing countries, bankrupt countries, underdeveloped countries, but most of all, it will help America. Do what's right, do what's patriotic, do what's best for America and support this plan.

(do I qualify for a governmental consulting position now?)

Mon, 06/04/2012 - 15:17 | 2493010 t_kAyk
t_kAyk's picture

Consulting position?  Screw that, here's your Nobel Prize!!

Mon, 06/04/2012 - 14:34 | 2492860 Offthebeach
Offthebeach's picture

Why don't lefties just buy with their trust fund money Spanish bonds, make a do-gooder profit and save Spain?

Mon, 06/04/2012 - 14:56 | 2492941 Overfed
Overfed's picture

Damn straight! All of the liberal Hollywood actors should start writing checks to bailout the EU and the US. Oh, but wait, they want to be philanthropists with our $$, not theirs.

Mon, 06/04/2012 - 15:32 | 2493077 blunderdog
blunderdog's picture

Bailing out banks isn't exactly a right/left kinda thing.

I don't think guys like Hank Paulson and Dubya qualify as "left" no matter how crazy your one-dimensional political scale is.

Mon, 06/04/2012 - 15:43 | 2493131 Offthebeach
Offthebeach's picture

I consider the GOP the go slow, " We can do socialism better, and classier " party. The Bush/Lott/Hasteret GOP was a big tax, bigger spending,bigger debt,bigger government administration. Ergo, lefties.

Mon, 06/04/2012 - 16:02 | 2493208 knukles
knukles's picture

It's not whether
They're lefties or righties
Or even Bawney Fwank
In his nighties

All they wants is
More this and that
Being Statists 
Is where they're at

Bawney Fwank/Larry Summers 2920

Mon, 06/04/2012 - 15:27 | 2493048 financial apoca...
financial apocalyptic contagion's picture

the system is so unfair!

People on the other end of the spectrum like Ron Paul are completely ignored where as these fucks are deemed "progressives" and will now be champions of this "save spain" movement.

Fuck it, A song of Ice and Fire is a much better read than some stupid economic research paper

Good catch TD- its very hard to find papers with such retarded ideas

I hope they don't get nobel prizes for this shit

Mon, 06/04/2012 - 16:05 | 2493222 knukles
knukles's picture

(snifflees and tears)

It's so unfair.

http://www.youtube.com/watch?v=kHmvkRoEowc

 

 

 

Mon, 06/04/2012 - 15:34 | 2493090 vocational tainee
vocational tainee's picture

Something dumb, as white bread,is asking the bakery to press the FED,to buy shitty real estate in SPAIN not to get caught at home?

Mon, 06/04/2012 - 19:51 | 2494045 Buck Johnson
Buck Johnson's picture

They will and it won't be pretty, because every time there is a QE3 it doesn't last as long in the help dept..

Mon, 06/04/2012 - 14:05 | 2492724 LeBalance
LeBalance's picture

This is Captain America callin'

i bailed you out when you were down on your knees

will you catch me now I'm falling.

 

 

Mon, 06/04/2012 - 14:17 | 2492789 macholatte
macholatte's picture

 

The mental illness known as the "Progressive Party" has captured the US government from White House to Congress to Supreme Court. It is the political cancer from the 20th century and is slowly killing the host.

Mon, 06/04/2012 - 14:42 | 2492887 FlyoverCountryS...
FlyoverCountrySchmuck's picture

THE MESSIAH, BLACK JESUS is endangered by this constant stream of bad economic news. this must not be allowed to continue, no matter the cost to the taxpayers.

What matter the Muppets, when compared to THE GLORY OF OBAMA?

And here, I thought the Messiah Obama told us that "THE ERA OF BAILOUTS IS OVER!", back in 2010? I must be a RASSIS!, or a phobe, or sumpin, for remembering that inconvient truth.

Wait..

I hear a knock at the door. It looks like the Obama Truth Squad/Thought Police. Back in a moment....

 

 

Mon, 06/04/2012 - 15:05 | 2492975 kralizec
kralizec's picture

Hey?  Where'd ya go?!

Mon, 06/04/2012 - 15:17 | 2493009 Ahmeexnal
Ahmeexnal's picture

They took him to Lefortovo.

Mon, 06/04/2012 - 15:31 | 2493072 Calmyourself
Calmyourself's picture

+1 for the lefortovo reference..   He tried to warn us, Ivan that is..

Mon, 06/04/2012 - 16:07 | 2493247 knukles
knukles's picture

 

 

 

"It's not the people who vote that count. It's the people who count the votes." 
             -Josef Stalin

Mon, 06/04/2012 - 14:42 | 2492888 Uncle Remus
Uncle Remus's picture

World+dog to US Taxpayer: Bück dich!

Mon, 06/04/2012 - 15:03 | 2492970 Mugatu
Mugatu's picture

Why is the world so fucking scared of a Recession now?  Used to be one would come along every 4-6 years.  Just like a good storm, they clear away the dead and rotting branches and provide new life for many industries.  In college economics we all learned that they help redirect money to better endevours.  

Why does everyone fear them like the plague now?  Its natural.  They need to happen.  Don't fight it - embrace it.

Mon, 06/04/2012 - 15:07 | 2492979 Uncle Remus
Uncle Remus's picture

This is not your father's recession.

Mon, 06/04/2012 - 15:18 | 2493012 Matt
Matt's picture

This isn't a cyclical downturn. This is a secular end of global debt growth depression. I wonder if the economists and politicians running this gong show realize this and are choosing not to acknowledge it, or if they really believe in what they are doing.

Mon, 06/04/2012 - 16:22 | 2493318 knukles
knukles's picture

Acknowledge?
Acknowledge!

Last night on Bloomberg and CNBS during the early Asia hours it was fucking hilarious.  My wife was giggling while I was talking back to the people on the screen.

Them:  OMG, it's just amazing!  The markets are getting hammered!
Knukles:  A slip, a small drop, a slide.  A downtick.  You ain't seen hammered yet, dipshit.  Jesus H Fucking Christ on a Stick.  Try another 25%, then tell me if it hurts.

It:  Ah, leally gleat learnings at Dong Fong Motors, gleat crumpanie, penetlating many adishunnl malhets.
Knuks:  Yeah, unload that shit before you get penetrated anymore, dumass.  Maybe send the crap off to Kim Jong Dong Ill the 4th.  Like write it the fuck off right now.  Now.

Her: But will this really and truly sap any of the buying at the absolute pinnacle high end of the luxury goods market in China, the Aston Martins and gold and diamond encrusted iPhones, for example?
K:  Oh fuck no, but it'll get you summarily shot in the forehaed for flouting that shit pretty soon.

Ben Bernamoochie (AIG head):  After this shits over, 80 is gonna be the new retirement age.
K:  Ben, I got some news for ya'.  This shit is sooo fucking far from over, you're not gonna be retired, you're gonna be in the fucking nursing home drooling in the spit cup.  Over, before it's over, starvation is gonna be the main concern.

EU heads:  We promise to have a plan to solve this soon.
K:  I promise not to cum in your mouth.  Honey?  Honey!  Where'd you go?  No, I was talking to them, not you.  Whaddya mean I alwasy lie about that.  Oh come on doll...   OUCH!
 

Mon, 06/04/2012 - 15:35 | 2493091 Calmyourself
Calmyourself's picture

Notice how the constant media drumbeat of "recession' has dumbed down this probably very bright poster.  Obviously we have been in a recession for years, the media would like you to forget there is a "cession" with a DE in front of it at least as long as the bamster is in office.  Now once Mittens is in DEPRESSION will become quite popular as a description  of the economy.

Mon, 06/04/2012 - 15:55 | 2493168 Real Estate Geek
Real Estate Geek's picture

Why?  For the same reason we're now so scared of forest fires, which also used to come along regularly.  Too long without means that lots of deadwood has accumulated.  When it comes it won't be a fire, it will be a conflagration.  (Think Dresden in 1945.)

Mon, 06/04/2012 - 14:06 | 2492731 mrktwtch2
mrktwtch2's picture

why is it that if 310 million americans vanished tomorrow the world would collapse economically..now if 6.7 billion people vanished the us would still survive..it would not be easy but we have our own food oil and manufacturing ability..we should be using this truth to our advantage and stop electing politicians who are trying to turn this country into europe..

Mon, 06/04/2012 - 14:14 | 2492776 Everybodys All ...
Everybodys All American's picture

the globalist's are in every level of government and it unfortunately appears no amount of elections can remove them from there detrimental influence.

Mon, 06/04/2012 - 14:53 | 2492933 Vince Clortho
Vince Clortho's picture

Exactly.  Replacing one globalist Boot Licker with another Globalist Boot Licker is not going to solve anything.

People need to Wake Up.

The Dog and Pony show that is the two party system in the US is corrupt.  People who are ideological slaves to either party are completely missing the Big Picture.

The Christians never win against the Lions.  The only sane choice is not to play their rigged game.

Mon, 06/04/2012 - 15:03 | 2492968 smb12321
smb12321's picture

I am a libertarian but realize that with instant communication and trade we are all in a sense globalists. The trouble with progressives is that they want the world to be a mirror of their dream of an authoritarian nanny State. This explains their attempts at trying to instill guilt for not throwing money down the EU black hole of debt. That grip NEVER leads by example

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