Arrogant Fed Hasn't Learned A Thing
Mishkin Impossible -- By Bill Fleckenstein
The bubbles, toils and troubles that nearly wrecked the financial system should've been obvious to the policymaking numbskulls whose monetary tricks made matters worse.
"Arrogant and incapable of learning."
When a teacher uses those words to describe a student, it's an isolated (if regrettable) situation. But the repercussions are widespread when "arrogant and incapable of learning" fits the Federal Reserve like a glove.
Still clueless after all these bubbles
Frederic Mishkin, a former member of the Fed's board of governors, wrote an article in last Tuesday's Financial Times that displayed that he, and presumably other Fed heads, have learned exactly nothing from the disastrous consequences of their activities in printing money over the past couple of decades.
The headline sort of says it all: "Not all bubbles present a risk to the economy." That is completely false. Any genuine bubble poses great risk, which is why they should be avoided, as I have warned repeatedly since at least 1997.
Meanwhile, when the two biggest bubbles our country had ever seen (those in stocks and real estate) were under way, most people appeared to be incapable of identifying them. Now the word "bubble" is bandied about constantly, as almost everyone seems to believe several are under way in various places (but that's another subject).
In any case, crowd psychology gone mad can produce a bubble in most anything. But when that mentality bumps into central banks like the one that has evolved in the United States under the tutelage of the Fed's Alan Greenspan and Ben Bernanke (who are now being emulated nearly everywhere), incredibly disastrous policies follow.
Nothing to fear?
Mishkin opens by arguing that a potential new round of asset bubbles would not, contrary to what some people have suggested, "provide a case for the U.S. Federal Reserve to exit from its zero-interest-rate policy sooner rather than later."
So for anyone who ever gets tempted to be sucked in by the Fed's tough-guy talk, this is another example that nothing short of radically higher inflation or, more likely, a far lower unemployment rate will cause the Fed to tighten the money supply by raising interest rates -- unless, of course, the printing press is taken away first. (That, too, is a subject for a different week.)
Read the rest of Fleck's piece HERE
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Nov 17, 2009 at 12:43 PM
Reader Comments (17)
I am sure that DailyBail, after he returns from the well he fell into, will post this interview.
Obama is failing in Asia, what's new. The Europeans who wanted to profit off of our green market is very upset that Obama has agreed (with who I don't know) to delay the global war... climate change...what are we calling it now? cap and trade agenda.
Obama bows to Emeror in Japan, does he realize he is not Al Sharpton. What is his problem?
Obama sucks!! very sad to see our president go around the world and bow down to everybody.
I remember 30 years ago or so when people were fired on the spot and subjected to a little bit of public humiliation for failing to do their job. Am I dreaming?
Now, it doesn't seem to MAS (Make-A-Shit) if you do your job or not. I mean it is all over. You see it everywhere. The most recent example I was reading today where some higher up in the PBGC decided to put 10s of Billions of Dollars into the market in the Spring or Summer of '08 only to lose Billions more when the market tanked months later. How could a person in that position not know the state of the markets and whatever happen to DCA (Dollar Cost Averaging) that is thrown at us peons all the time? Does one guy make all the investment decisions at the PBGC? Well, that's just great!! So, what happen to the Investment Council or Vote by Committee? That makes me think he did it deliberately for some perverted reason. He couldn't really be that stupid, could he? Could everybody else at the PBGC also be that stupid? How could that be?
WBF (Sorry, We're Basically Fucked!)
"Obama bows to Emeror in Japan, does he realize he is not Al Sharpton. What is his problem?"
From here on out you will see all Presidents with their faces firmly in the laps of our debtors. We are not capable of making interest payments, more or less principal. This is why for years, we see more foreign influence over our affairs. The big stick no longer exists. We are paying China alone 50 billion in interest a year, money for nothing, and their "advice" for free.
As we pound our weapons into plowshares, the rest of the world is pounding those plowshares into weapons. But look at the money we are saving...
Why Does Obama Keep Bowing?
by Bradley Blakeman, FOXNews.com
President Obama’s silent bow is yet another way of apologizing for America’s misperceived arrogance and superiority. He has found yet another way to pander and apologize without ever uttering a single word.
Barack Hussein Obankster bowed real low in recognition of the fact that we are a deadbeat nation of bankrupt financial swindlers & war criminals whose continued future existence rests entirely in the (hopefully) forgiving & forgetful hands of Asia.
How many names do you post under?
Ben is an embarrassment to America....AND a SHILL for his captors.....Politicians and their captors...Wall Street. He has done NOTHING in accordance to his talk...strong dollar...blah blah......FLUSH...you hear that? That is the sound of your YOUR FUTURE....AB
Remember this post Ain't the Bull
Don't know if anyone here's a Kevin Smith fan, but here's a quote from the Angel Loki in "Dogma":
" Do you know what makes a human being decent? Fear. And therein lies the problem. None of you has anything left to fear anymore. You rest comfortably in seats of inscrutable power, hiding behind your false idol, far from judgment, lives shrouded in secrecy even from one another. But not from God."
http://www.youtube.com/watch?v=kgMiLYF-sM4
just seemed apropos.
just seemed apropos.
That one is for you DB.
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Nice comments....
As we pound our weapons into plowshares, the rest of the world is pounding those plowshares into weapons. But look at the money we are saving...
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Well stated...
http://www.youtube.com/watch?v=Z_NrX7A3-ZQ
I am sure that DailyBail, after he returns from the well he fell into, will post this interview.
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This is the particular well that we fell into....
http://www.pgpf.org/multimedia/summit-webcast/
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We're up in Chicago all week...participating and covering this event...David Walker delivers the keynote tomorrow...looking forward to getting him on camera afterwards...
Sending Banks and Govt Agencies stocks sharply lower.
The entire premise of changing the accounting rules for criminal banks was so they could hide their losses, buy them some time with the hope the housing and commercial real estate market would recover, riding the wave of the so-called economic "V" shaped recovery.
Another truly delusional belief on their part.
During the previous Great Depression maybe 20% of the population owned a home, the majority were not in debt. Hence, the decline in home prices, rising foreclosures were a small part of the problem compared to today's Fed/Goldman engineered economic debacle.
Thanks to three decades of easy Fed money, easy credit, the securitization of mortgages and other toxic assets and zero regulation nearly 70% of Americans now own homes.
The problem many Americans purchased homes based on a false economy, a false inflated standard of living, fueled by debt, ludicrous monetary policy and derivatives.
Owning a home is a costly endeavor, repairs, taxes, maintenance, a luxury many homeowners simply can no longer afford.
Rising unemployment, falling wages in America will continue until an equilibrium is reached with Chinese slave wages.
The sad truth is entire U.S. neighborhoods will need to be bulldozed, the residents moved to chicken hut accommodations that better reflects the value of their currency and job prospects.
So we have plenty more deleveraging to go on the housing front. The real estate bottom won't be reached until we are back to the 25% home ownership mark.
We are fast approaching a two tiered society in America. The small percent that receives outrageous bonuses & salaries for failure, for engineering toxic bubbles...and the impoverished majority who are forced to pay the blood money.