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The Punchline In His Own Words: Bernanke Advocates Blowing Asset Bubbles As The Antidote To Depression
If there was one absolutely must see moment exposing everything that is broken with the Fed's brand new policy of QE-nfinity, it was this exchange between Reuters' Pedro da Costa and the Chairman. It explains, beyond a reasonable doubt, that the only goal the Fed now has is to reflate the stock market bubble to previously unseen levels, to focus on generating jobs although not for everyone but only for Wall Street, consequences be damned, because by the time the consequences arrive, and they will (just recall that subprime is contained) they will be some other Fed chairman's problem. Bernake's term mercifully runs out in January 2014.
From the official transcript:
QUESTION: My question is -- I want to go back to the transmission mechanism, because speaking to people on the sidelines of the Jackson Hole conference, that seemed to be the concern about the remarks that you made, is that they could clearly see the effect on rates and they could see the effect on the stock market, but they couldn't see how that had helped the economy.
So I think there's a fear that over time this has been a policy that's helping Wall Street, but not doing that much for Main Street. So could you describe in some detail, how does it really different -- differ from trickle-down economics, where you just pump money into the banks and hope that they lend?
BERNANKE: Well, we are -- this is a Main Street policy, because what we're about here is trying to get jobs going. We're trying to create more employment. We're trying to meet our maximum employment mandate, so that's the objective. Our tools involve -- I mean, the tools we have involve affecting financial asset prices, and that's -- those are the tools of monetary policy.
There are a number of different channels -- mortgage rates, I mentioned other interest rates, corporate bond rates, but also the prices of various assets, like, for example, the prices of homes. To the extent that home prices begin to rise, consumers will feel wealthier, they'll feel more -- more disposed to spend. If house prices are rising, people may be more willing to buy homes because they think that they'll, you know, make a better return on that purchase. So house prices is one vehicle.
Stock prices -- many people own stocks directly or indirectly. The issue here is whether or not improving asset prices generally will make people more willing to spend.
One of the main concerns that firms have is there's not enough demand. There are not enough people coming and demanding their products. And if people feel that their financial situation is better because their 401(k) looks better or for whatever reason -- their house is worth more -- they're more willing to go out and spend, and that's going to provide the demand that firms need in order to be willing to hire and to invest.
And there you have it.
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Fuck off already. The rest of the world is welcome to industrialize any time they want. They dont have to do business in dollars.
What is it you don't understand about the US dollar's hegemony in the world economy?
Sooo.. the banks can leverage that 40B...40/1? Say goodnight Ben.....you mother fucking idiot.
Silver Bitchez....
Food Bitchez....
Feelings lyrics
Feelings
Nothing more than feelings,
Trying to forget my feelings of poverty
Teardrops,
Rolling down on, my face
Trying to forget my, feelings of my homes worthlessness
Feelings,
For all my life I'll feel it
I’ll wish I've never met you, Benny-girl
You'll never come again
Feelings,
Wo-o-o feelings
Wo-o-o feelings
Again in my heart
Feelings,
Feelings like I've lost money
And feelings like I've never have you
Again in my savings.
Feelings,
For all my life I'll feel it rammed in my rear end
I wish I've never met you,bennie- girl
You'll never come again
Feelings,
Feelings like I've lost you
And feelings like I've never have you
Again in my life.
Feelings,
Wo-o-o feelings
Wo-o-o feelings
Again in my heart
Feelings,
Wo-o-o feelings
Wo-o-o feelings
the man is unable to tell the truth. with 57% of financial assets in the hands of the top 10% (I think, maybe less) the bernank helps out his cronies. for most, the vast majority they willlose much more from higher prices than they gain in their portfolio
Then they have the wrong portfolios!
We're happy - and I do mean both of us. We've always pretty much agreed on WHAT to own - just not on the WHY.
My WHY is the correct WHY. But you Fellas haven't yet realized it.
Being part of THEIR Script only goes so far.
Stressing our own Script is now needed more than ever.
But you're going to have to break away from immature Elitism in order to embrace it.
You only THINK - because so many of you are under 35 - that you want to grow up to be Paul Ryan. Believe me, you don't.
This country is about to experience a massive power shift away from both Fringes and back towards the Center, where it belongs. Get on board the Sane Train before it happens.
Maybe this comes as a shock to you, but there is a very, very large group of people out there who have no "portfolio" at all. Maybe a small savings account, or a cookie jar with a few bills in it, if they are lucky. They have low-paying jobs, barely make it to the next paycheck, do not live extravagantly, and do not accept government assistance. These folks are going to get absolutely clobbered.
Nah, the dirt-level working class (the majority of the US population) is going to do OK. The sorts of things that scare folks with portfolios mean nothing to us.
I think it's most likely the elderly who'll be the worst off if the entitlement party ever comes to an end.
Plus the group of folks who really believe the Murkin myths and won't understand why they can't find a $60K/year marketing job with 15 years experience in the biz.
The poor already know how to mop floors, stay out of the sight of the cops, and smile for the massah bossman.
If you Ninnies think you prove your points - any of 'em! - by giving Thumbs Down to my extremely sane, logical, and CORRECT comments, you are sadly mistaken.
It is my generation, the Baby Boomers, 1/3 of the population, probably 1/2 of activitist voters, and the vast majority of Those in the Market, Those Who Own Homes, and Those Who Run Small Businesses who will determine the outcome of the next several elections.
Our political tendencies are now skewing extraordinarily fast towards the Sane Center, whether we identify ourselves as Republicans, Democrats, or Independents.
You would do well to respect us and engage with us, rather than scorn us and ignore us.
Because it is we who will determine your future - politically and in the Market.
Did you reply to me for any reason, or you just nattering some Alzheimer's shit? I'd love to engage with you, but you don't make any sense.
What in the fuck are you even talking about? This country is about to shift towards a gray state and a whole shitload of civil unrest accompanied by some major shitstorms overseas. We're fucked big, and no amount of bullshit feel good social justice is going to change that.
Get ready. Quick.
I had my doubts before about the Bernank's mental stability, but after today I am 100% convinced that the man is certifiably insane. His actions are like going all in on a $1M poker hand with a pair of 3's. It's like jumping off a 20 story building with a pillow strapped to your ass and fully expecting to survive. Historians are going to look back on this era and simply say "WTF were they thinking?"
Bullish on luxury goods retailers and dollar stores (soon to be ten dollar stores, one hundred dollar stores and so on).
It's like seeing the police helping the robbers unloading the loot.
No checks, no balances, no accountability, just vacantly rhetorize and carry on with the task while nobody notices this charade.
Print "for the economy", while enacting austerity for the plebs, who, "surprisingly" aren't exposed to the upwards-only, equity elevator, while their dwindling stipend can barely afford food and heating, due to the inevitability of price-inflation in vital commodities, because of the Fed's printing in order to buy Fannie & Freddie's toxic MBS portfolios.
I remember in the mid 1970s, 1977 to be exact, the gneral mindset of middle class families re: spending was, "if you're going to need something in the near future, you better buy it now before the price jumps"....and even though folks spent, profits sucked, housing sucked, wages sucked, the economy sucked. Why is this bearded fuck willingly taking us back there?
But it's worse than that. Today's economy relies upon consumption of things we don't need. This is why policy is geared towards the top percentile - they have all the discretionary spending power.
Bernanke's response to a great question is unbelieveable. This is the way someone thinks who is not in command of his own emotions. If he is not an evil genius who is executing a master plan to ruin the nation, this is nothing more than how an undisciplined gambler (loser) thinks. To actually try to control a complex system with a "belief". No logical data, no ground truth, no facts, no scientific method. He's admitting that he is depending on his belief and the "feelings" of the huddled masses to eventually prove him correct. The complete idiocy of this man's strategy is mind blowing. I lived in Argentina from 1989-91 and saw what hyperinflation does to people's lives. This may well be the beginning of the end. He has fucked this country.
Not to Ben.
He 'loved this country'....just like a pedo, he thinks he's the victum and 'misunderstood' ...
Ben is like Michael Jackson, they both love blowing ...
Dear Ben,
At the end of this day, starting from the first day years ago when you started this, not only am I NOT any wealthier I do not even FEEL any wealthier. Therefore I shall not spend any more than I already am on necessities while continuing to eliminate any and all personal debt (almost done with that) and taking on no more debt of any kind.
I do not trust you. I do not think you really care if this works for Main Street.
Main Street, USA
@ptoemmes: I'm with you. After 3 years of slogging hard, my only debt is mortgage, which is being paid off rapidly, and I've got 9 months of expenses saved up if I lose my job tomorrow.
My wife and I share a 10 year old car that's paid off. My next door neighbor, about my age (50s), makes a lot less than me but traded in his 5 year old truck for a brand spanking new $40k SUV of course with 0% financing.
I've got some phys silver that I keep not as an investment but as a hedge and safety blanket.
Some of my friends are gloating because their retirement money in mutual funds are way, way up. But, as is usual with a Ponzi scheme, will they have the brains to get out first? (and pay a penalty? I think not)
I am very happy today. My life is relatively stress-free. I think Ben absolutely jumped the shark and I feel 100% vindicated.
And, fuck you Ben. You are a slimy, evil fuck. You have a face that I would never get tired of kicking.
One for the cigar smoking "old timers" Nancy Sinatra" http://www.youtube.com/watch?v=wwNCxjxSqrE
Ayup: http://www.youtube.com/watch?v=SbyAZQ45uww
One of these days Ben's boots are gonna walk all over you.
Ben doesn't own any boots.
He's got those 'court jester' red shoes with curled toes and bells on them.
'Me chairsatan, me make you laff!'
Did you notice all the "vacant" land under the "Balloon"?
I, for one, cheer Mr Bernank. Simply buy GLD, SLV and oil and there you have it---protection. INstead of plopping down that money into the Black Hole (a house), buy safety in commodities my family financial advisor recommends.
Even AARP suggests renting now instead of buying the depreciating lead weight called, "a house."
http://www.aarp.org/money/budgeting-saving/info-12-2010/rent_or_own_what...
GLD, SLV? Paper; but hey custodians are HSBC and JPM and the custodial security is impenetrable (at least to anyone trying to enforce it) so it's as good as the real thing, right?
The other TRULY scary point he made was when he said that the Fed earns interest on the mortgages and treasuries it buys which it remits to the Treasury which REDUCES the deficit, so it's all good!
Let's see. Conjur money out of thin air, but any interest bearing asset at any level and one has a money machine with which to REDUCE the deficit? Under that theory, you are best off by buying all the treasuries and all the mortgages issued and our deficit can be reduced further. I guess that's next.
if they simply print as much as they need, there is no need to borrow and voila, no deficit. It's a well understood fiscal policy and it worked fine in, um, let me think...
Spend your savings when we tell you and on what we tell you .... or we will make your savings worthless !
BERNANKE: Well, we are -- this is a Main Street policy, because what we're about here is trying to get jobs going.
Fucking Congress couldn't do their job for the last 30 years, Ben certainly can't do it through monetary policy... WE ARE FUCKING DOOMED....well, at least the S&P will be up....FEEEUCK!
Bernanke is a pompous fool not unlike the emperer who wore no clothes. But he is not as stupid as he made himself look today with this ridiculous policy statement and the even more half assed defense he provided after. This leads me to believe that this is a distraction from something more sinister. The other peculiar thing is that USO closed lower than it opened, the FOMC spike only brought it back to the opening levels. What up with dat?
I swear to Mother Nature this douche is just making shit up now. Literally just making shit up as he goes because its crashing down around him and he knows not what to do.
Let the motherfucker burn. Burn motherfucker burn.
Hit the bid. Run, Dont Walk. Say "yours" to WALL STREET, the FED and the idiocy of their self-serving policies. Todays action is one for the history books as the dumbest move ever conducted by the US central bank, clearly cratering to Goldman's desires.
Q: Why do Congress and the Fed not like Blowjobs?
A: They don't like any sort of job...
Who is Uncle Ben gonna favor with these "purchases"? The dual whores Fannie & Freddie? The upstanding Shiti Bank and JPM Chase?? The man with immunity - Johnny Corzziine? Ameriquest corpse? The Tan Man? Barraq?? Inquiring minds want to know.
It's FOR the SYSTEM! You know, the System that REQUIRES us to violate the fundamentals of math by continuing to pursue the lunacy of perpetual growth on a finite planet.
The longer people keep being distracted by all the dancing puppets the longer it'll be before we have ANY sane discussion about how we're going to live on this here finite planet.
I dunno which would be preferable, to be chained to the machine to build TPTB their escape vehicle off this planet (and say good riddance to them), or to be locked in an eternal battle with them (and their ability to suck up all resources in support of their "defense").
"they're more willing to go out and spend,"
I suppose someone ought to explain to him that dead horses don't drink water.
SPot on Tyler, I spotted this aswell..
What an absolute cock Bernanke is. All that education, PHd, etc. etc.... and all he can come up with is a plan to make the stock market the last great bubble - why - so people with 401ks etc will go out and buy ipads...
Great fu**in contribution to humanity Helicopter Ben,, applause
Ever consider what the third world will look like when they start experiencing the exported inflation from your ass Bernanke? In case you didn't notice they're already burning US embassies down left right and centre. What do you think they'll do when they cant afford to eat!?
All so over endebted Americans can afford to go out and buy ipads.....
What is the original article/source for this interview? I did a search and couldn't find it, sry.
Hey, I thought Fischer was a fiscal hawk. LOLOLOLOLOLOLOLOLOLOL.
"feel wealthy"? as oppose to the overlords.. Be Wealthy
FED owners sold market in the first place to 666 .
rinse wash repeat!
At the next Fed meeting I will be expecting more QE. It seems to me that what he has done is not enough. In fact if Bernak doesnt expand QE further next meeting I am going to sell my stocks and not vote for Barry.
I will be expecting a major anouncement in October.
Let go Bernank get off your but and do something or else.
Hi Ben! Quick question... what about folks who: A) do not own a house, and B) do not own any stocks to speak of? How does this make them feel "richer" so that they spend, spend, spend? As an example, 3 of my 4 kids... who are just getting started and now will have to pay more for gasoline and food. Screw them, I guess? Why not just come right out and say it?
I think "mainstreet" is where you hope and pray you never have a flat tire....
Not to worry, FedAPPL is coming out with a "solution!" An "app" for the little people will soon come out that tells everyone, all the plebes, that they are wealthy! Whenever you're feeling less than wealthy (like you might be one of the 4+ BILLION people on the planet who live on $3/day or less) then all you do is bring up the app (which will, of course, bill you $2.00 [in real terms]) and it'll reprogram you, er a, inform you that you are not one of the $+ BILLION living in extreme poverty. Fucking WIN WIN!
House prices will not be stopped by Ben's QE. All this does is move the toxic (worth-less) mortgages from the banks balance sheet to the Fed's balance sheet (and to taxpayers). Banks will therefore continue to hold massive vacnat houses off the market since they have no incentive to sell them.
You are correct that food, oil, gas, PMs will soar in price due to loss of purchasing power of the dollar and Billions more are added (printed) to the system.
Houses, cars, etc will continue to depreciate and drop in value as evidenced by the last several QEs and TARPs.
Why doesn't this klown just open a window at the Fed for those of us who need to re-fi?
Moron.
That's pretty short-term thinking there! If any order to open up any window is given it should be followed by instructions for the lot of them to jump out of!
from the avg joes perspective, ive seen ford trucks go from $8k-$48k, monthly wages from $400-$4000, PMs up as well..what's the rationale that this is soon coming to an end?
Paying more for gasoline & food IS spending. Mission Accomplished.
And there you have the crux of it. See, old Ben and the boys in the Washington Hood have never been poor or even working class, nor have they, for the most part, been middle class small business owners. As asset prices rise, which is the stated plan, wages do not. In fact, as input costs rise, wages decrease, because businesses must offset rising input costs with decreases in labor costs so that they do not have to raise prices and can retain their customers. As the money spent on wages decreases, the ability of wage-earning households to spend is hit with a double-whammy: higher fuel and food costs, less in wages.
It's pretty obvious that Ben doesn't get it. Those who need help are the people who no longer own a home because the TBTF banksters stole it while meantime they lost their jobs and have liquidated all the money in their 401K to survive.
This plan is no different from the previous plans; will not move the meter one click positive. Next BLS report will reflect another quarter-million cut from the working force ranks.
Don't fight it. Just front run it.
I've had my drinks
I've taken my pills
I have smoked my J's
I have my PM's
I will see you ZH dudes on the moon ....
Best comment of the thread.
Damn, this is a good day on zerohedge. The material to use is awesome.
What am I missing?
Each round of money printing (let's not call it QE, that's just subterfuge) does make me want to get rid of cash faster by buying stocks, oil, gold and anything else that they can't print more of so I can perserve purchasing power. BUT, in contrast to Bermanke's theory, it also makes me want to spend less as my savings earn nothing AND because I worry about inflation accelerating so things will cost more in the future AND I also worry that the value of those assets I just bought could crash because they are appreciating faster than fundamentals because of manipulation and not reality.
...and the more you want to save....the more you buy commodities because the interest rate is low....therefore prices go up and inflation sets in...which means your $$$ are worth less...so you invest in....
(hint to Ben: its not the stock market - because that relies on trust - you do remember what the what trust meant (past tense) don't you Ben?>
Absolutely. The only way left to ATTEMPT to get to retirement by 'conservative' means is to save 50% of your income. That which (lack of) interest payments has taken away must be replaced if there is to be any chance of a 'retirement.'
Of course, really, I think that for people in the 90th percentile and lower, the chances of any kind of 'retirement' are nearly pegged at 0%.
Retirement? In the entire history of humankind this is a but a blip. I gave up thinking about retirement a LONG time ago. Better to focus on being productive until you keel over. I'm going the farming path, I figure that people will eventually figure out that food is more important than iJunk (brought to us by FedAPPL).
Tyler hit the nail on the head. If there is no demand for products or services, you can print all you want and it won't make a difference. When will people learn it's the entrepreneur that creates jobs with new technology, products, and services. The banker can help him expand his business, but it all starts with him. We've been made to believe we cannot live without the banker. it's the entrepreneur we cannot live without.
The ChairSatan has another YEAR before he goes
ARRGHH... kill me now........... before I starve to death with hyperinflation of all the things I need, like FOOD!
For real... food prices are already ridiculous.
Wrong, it's not for blowing up the stock market bubble. It's near all time highs already. These FED moves are being used to inflate HOUSING. They must inflate that shit before they let forclosures roll, otherwise the banks will be ruined. They have to keep housing from going down, at all costs.
But for people to be able to buy they need jobs to pay the mortgage and if jobs are as rare as hen's teeth or they pay appalling wages they they can huff and puff and try to blow it back up all they like they will just end up collapsing from hyperventilating
He's able to say this is a policy for main street because many people own houses. So it's a policy for the masses because their homes won't be underwater so much. But in my opinion, this is really a policy for Wall Street. If the banks are forced to write down losses on MBS exposure (in a world where asset prices reflect their true worth) , they're toast. I suppose it's also possible that he really is dillusional and thinks maybe if they inflate housing that people that lost their jobs in construction will start working again, but I don't think he's dillusional or stupid.
Ben can suck up the entire MBS market if he wants, but if no one is actually buying houses, housing prices stay the same or decline, right? Ultimately, you have to have an income and credit to get a mortgage... so that leaves it to investors. Let me guess... it will probably be hot money from Wall Street buying everything up so they can sell it directly to Ben for a cut. They'll find a way to milk it somehow. Just wait. What a crock of shit.
Everyone below the 85% percentile of income is already spending everything they make - and more.
And when you have some people paying their income tax with a credit card, it's truly game over.
Ben Bernanke send me some green!
http://www.youtube.com/watch?v=vqSfnH51KX8
I shorted this " quik-silver" scheme 2 hours ago! Asia/Tokyo fix usually takes profit on "North American" trades!
The M/E and (Sino/Russian) rinse wash.
Oh my God, the guy is fuking moron.... People dont spend because the costs of living rise faster than their salaries do... Question for you Ben, why do the costs of living rise? Hint: Make a plot of commodity prices vs S&P and your money injections.
That is not a "bull flag" people! It's the last gasp of " central banking"!
Dont blame Ben, he takes his orders from this guy
so, the secret is...
income is a function of asset value, not the other way around..
cart, horse?
World War is coming.
where, in which cinema theater?
I thought the next block buster was Avatar?
When I heard "consumers will feel wealthier" here's what came to my female mind.
Vanity sizing. Where the clothing manufacturer "inflates" the size proportionate to the size tag the item receives. Just because you can now slip into a size 6, doesn't mean you've actually lost weight. The clothes have gotten bigger, YOU have not shrunk. You might 'feel wealthier" or "feel thinner" but it's based on a false perception of reality. Reality, like arithmetic, will win the day.
bernanke and obama need our prayers
Save a prayer for yourself and forgive your enemies because the enemy is coming to take what's yours.
Gold and silver, equities going up.
So what?
Just means that the money is worthless and less and less.
There's a store of value, a "safe" haven but there is no GAIN.
The flight from anything paper into tangible assets will take off like a moon shoot.
When not one but two CENTRAL BANKERS tell the world they will DO WHATEVER IT TAKES to SUSTAIN the unsustainable debt levels with virtually nothing more backing it today than yesterday BUT creating virtually TRILLIONS of CASH going forward ...
What is the only logical thing for ANYONE in the world to do? FLEE FROM CASH AND ALL CASH DERIVATIVES.
This is going to get ugly real fast. From bad to worse in the blink of an eye. The cat is out of the bag. Many here have figured this out and many more of your friends and neighbors are going to figure out that the emperor is naked and that money is worthless.
Oh yes, people "FELT" extremely wealthy between 2003 and 2007 and then...oh well, the rest is history as they say
http://i.imgur.com/XaiUx.gif
LMFAO! +1
Weeeeeeeeeeeeeeeeee!!!!!!!!!!!!!!!!!!!!
this one will remain in the history book!!!! if a blow a bubble which makes you feel wealthier... you gonna go spend.
BB, the next QE is... go buy the house, the car, the iphone etc.. just print and buy !!!
So judging by Ben, America actually have an insufficient spending problem then..?
1. Que how did the build the largest defecit in the world then and run up -119Bn last month as a trade balance?
Fuck this shit, I'm going golfing!
Why Doesn't he just print jobs instead?
There are not enough people coming and demanding their products. And if people feel that their financial situation is better because their 401(k) looks better or for whatever reason -- their house is worth more -- they're more willing to go out and spend,
************
Trying to gun sentiment-but it wont work-
That is the one eyed monster called the market that he's trying to push aside-it has had Bernanke stymied since the start and it wont lose-
Jimmy
This is no QE in my opinion, if they buy MBS only from Fannie and Freddie. Money goes from the Fed to the Gov account. Private banks get nothing.
However, if they buy MBS from primary dealers, what matters is what are the primary dealers going to do with the money? Nobody knows yet. But if they buy stocks, more stocks will be removed from the market hence volume will continue to get worse and worse.
It doesn't add up, it just doesn't. It's very fishy.
However, if they buy MBS from primary dealers,
It doesn't add up, it just doesn't. It's very fishy.
*********
I think that might be the plan-in hopes that the money will trickle into the economy through ATM via the stock market-
Also-we have to keep in mind how coordinated they have to be in devaluing-they have to keep it competitive-otherwise one of the majors could head south and maybe worse north ie CHF
That is a currency crises of a different sort for the Swiss-
It sounds like China will come on line with some stimulus as well-no one can have too weak or too strong of a currency-only Goldilocks stuff-it will end in a panic by central banks buying gold on the open market trying to stabilize currencies--somewhere ahead of us-
http://bit.ly/L9EotK
As the many other Zhedgers before me... *cough* GO TO HELL BERNANKE! Side note: My local dealer is out of silver rounds. Go figure.
hiring and jobs after $ reset and debt is reset.
What should keep those with a large exposure to the stock market up at night is Bernanke's Bubble Policy has officially gone mainstream.
Back in late 2008 / 2009, only the erudite, people that comb through Fed research papers and the like, understood waht the policy goals of BB's Monetary Policy At The Zero Bound entailed.
By late 2010 / early 2011 Bernanke would occasionally, usually in testimonies to congress, hint that QE "pushed" investors into stocks, corporate debt and MBS.
Now he is openly stating - to mainstream financial entertainment "journalists" - that a primary goal of his "main street" monetary policy is inflating the price of assets, such as stocks.
I HOPE oit works to lower unemployment. But it won't. But it will make investors RICH!!!!
http://confoundedinterest.wordpress.com/2012/09/13/fed-pulls-the-trigger...To the first real question I remember being asked by anyone since 9/11, the Chairman of the Fed responds:
"There are a number of different channels -- mortgage rates, I mentioned other interest rates, corporate bond rates, but also the prices of various assets, like, for example, the prices of homes. To the extent that home prices begin to rise, consumers will feel wealthier, they'll feel more -- more disposed to spend. If house prices are rising, people may be more willing to buy homes because they think that they'll, you know, make a better return on that purchase. So house prices is one vehicle."
To the extent that home prices begin to rise, consumers will feel wealthier, they'll feel more------more disposed to spend.
?????????????????????????????????????????????????
There is NO ONE behind the curtain!!!!!!!!!!!
This party becomes stranger with each twist in road
Cheap drugs and alcohol never had anything on this 'reality'
Amen, Ben om
The "jews" must be feeling REALLY confident if they feel they can go on the electric synagogue live, and spit in the eyes of everyone's savings and labor and tell them their food and gas prices will increase and their labor worth much, much less as a result of their counterfeiting operations.
Or this is their final gambit.
I would sleep with one eye open if I were a child of the lie.
Hitler has been vindicated. Mein Kampf proven correct.
A PeopleThat Shall Dwell Alone (1994), Separation and Its Discontents (1998), and The Culture of Critique (1998) by Dr. Kevin MacDonald effectively analyzes "judaism" as a conspiratorial group evolution strategy.
The pogroms will be global.
There's nowhere to run this time.
Even their golem, the blacks, have turned on their enabler.
Tucchus, meet corner.
Bernanke sounds like a puppet himself, with a script to read and deed to be done. Orders from on high - let's finish this thing.
You guys don't get it - our homes are our ATMs. Shut up and listen to Ben. I can't wait to feel wealthy.
I should have known!!...I've been living in ZIMBABWE, all along!!!
Know anyone selling an "cotton pikin sac" to fill with all this "fiat"?
1930's redux... Up we go in the moment, then down we crash.
Dr. Anderson of Chemical Bank Says Remedy for Business Slump is Only Temporary
"Cheap Money is a stimulant, also an intoxicant," warned Dr. Benjamin M. Anderson Jr., economist of the Chemical Bank of New York City, in an address here tonight. "If the dose is large enough," he said,"a very substantial temporary effect can be brought about, but headaches will follow. It is not the sound way to do it."
After saying that cheap money was a costly and temporary panacea for business depression, Dr. Anderson said:"It is definitely undesirable that we should employ this costly method of buying temporary prosperity again. The world's business is not a moribund invalid that needs continuous galvanizing by an artificial stimulant."
The Federal Reserve System and the central banks of Europe are under heavy pressure from advocates of the cheap money panacea, Dr. Anderson said. The matter is exceedingly simple in the minds of its advocates, he added.
Cheap money will not induce manufacturers and merchants to increase their borrowings in an unsatisfactory business situation, Dr.Anderson declared. He cited the figures for commercial loans as reported by member banks of the Federal Reserve System in support of this contention.
But if merchants and manufacturers will not use cheap money, he said, speculators will. They will use cheap money in buying stocks, for the prospect of capital appreciation.
...
NYTimes, April, 1930
Does history rhyme or repeat?
What else could he do? The people love politics. Politicians bribe voters. Debts ensue.
Central banks are caught between a rock and a hard place.
It's a pity that they counted money, and forsake the Republic whose values are priceless, and gave them refuge from their origins: monarchists, communists, Zionists.
This hubris is going to kill them. See the corpse of the U.S. ambassador to Libya, and the Arab Spring which will escalate to the caliphate, emboldened by Western stupid ways via central banks.
Islamists intend to kill us.
NO. The Constitution obliges no one to change the ways of foreigners. Trade, yes. Change, no.
This is the final head shot for all bears in the stockmarket. I expect the VIX to plunge under 10, S&P higher than ever seen. Maybe the ppl need some more time to understand what happened, but this is HUGE. A game changer.
yep, huge as in the cost of food and gas...but those dont count in inflations figures. somehow the first $2T didnt create many jobs, ,but this next round will.
financial asset inflation..only winners are people who already, right now, own multiple times their annual income in financial assets. high paid workers? out of luck, as you get to pay higher prices to acquire financial assets. money-earners, out of luck as your purchasing power will be eroded rapidly. more dollars, mean things/stocks/assets cost more, with no more economic value. its instantaneous and front run in the finaicial markets, takes a bit longer in the real economy. welcome to $5 gas, $5 milk, and no addl jobs.
shall we call it stagflation 2.0? stagflation 2013?
higher nominal values only work for those whose asset base is like I said above. 100k in expenses/yr? $2M at 8% with inflation of 5%, means they feel better by 3000/year in real purchasing power. everyone is screwed. if your only tool is a hammer, all problems look like nails.
with money free, 20x p/e multiple is cheap. they really could have fixed it by sending out checks to people rather than bailouts, AND thye'd have their financial inflation to boot..
For most people housing is not really an investment choice, it is a basic necessity that usually winds up being most of their net worth. yes, i know many people have made a lot of money buying and selling houses but most people buy because they find it preferable to renting often because of taxes. This mess is directly attributable to govt. meddling in the housing market to social engineer, forcing lenders to grant loans to people that were very high risk with the inevitable defaults totally wrecking the housing market and then preventing market clearing correction. the law of supply and demand will soon ,if allowed , put things in balance. The law is not subject to repeal by any govt.. It is not a ffed tool.
Wouldn'nt be simpler to have the. Fed Guarantee all new mortages? And say fix a 15 years 3% rate?????
Wouldn'nt be simpler to have the. Fed Guarantee all new mortages? And say fix a 15 years 3% rate?????
Good god! That was really Bernanke's explanation?
Ya gotta be kidding me!
I think I'm going to hurl.
"BERNANKE: Well, we are -- this is a Main Street policy, because what we're about here is trying to get jobs going. We're trying to create more employment. We're trying to meet our maximum employment mandate, so that's the objective. Our tools involve --..."
During the Great Depression, FDR took a different track- he attempted to force business to spend all their profits by levying a punative tax on retained profits.
In both cases, government is destroying the ability of the economy to grow by distorting free exchange and price signals. This is especially true today because information (signal) about the time value of money is one of the most important signals we have apart from direct price.
When all you have is a hammer, everything looks like a nail.
Venerability, you are simply amazing. That kind of utter stupidity doesn't come easy. Why I bet you've got at least four degrees hanging on your wall. Environmental Justice, PhD; Feminist Studies, MA; Underwater Basket Weaving MA; Socialized Birth Control, PhD; and let's not overlook the B.S. in B.S.