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Quantitative Easing Explained

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  • #16
    Re: Quantitative Easing Explained

    The Fed's long tradition and wealth of experience has been to very consistently screw things up, and speculate wrongly and/or incompletely about the effects their actions will have... so I don't see a lot of value associated with their "experience". The Treasury can certainly hire the same experts that the Fed can hire - but I hope they don't. The advantage for the American people will be that U.S. monetary policy will be dictated by our best interest rather than that of a group of international bankers, and will, as you suggest, have transparency. This would be huge.

    I'm not the only person that favors doing away with the Fed, btw. There's a small but growing contingent of folks in DC that are tiring of the shenanigans. Moreover, they feel betrayed by the Fed, since it is the elected officials that bear the wrath of the failed Fed policies come election time.

    Sounds like we agree on safety ands heath regulation. China does have an advantage in that, being a totalitarian communist state, they can control the standard of living of their workers. As you make reference to, recent changes in China, due to the suicides at Foxconn, raised the minmum wage to about $140 per month. Equivalent US factory workers in that industry (electronics manufacturing) make $10 to $20+ per hour... or, based on a typical month (40 hours per week x 4.33 weeks per month = 173 hours), at least $1730. IN general, Americans are more highly skilled, more educated and significantly more productive. But nevertheless wage disparity does exist.

    The problem I see is that no amount of reasonable adjustment in standard of living will close the gap enough to matter. Nor do I believe we should view that as the solution. The United States has very many advantages that we are currently not exploiting -- the result of which is that we are getting our butts kicked. The result of that *ss-whoopin' is in fact a decline in standard of living. And what does that mean? Now, some other terms that mean exactly the same thing are inflation, currency devaluation, weak dollar, unemployment, decrease in services, and higher taxes.

    And what is the solution proposed by the brilliant economic minds at the Fed? They've held the interest rate artificially low for many, many years. It is currently at zero. There is no way to do this without increasing the money supply. Which they have been steadily doing. Since the money supply (M3 is a secret that the Fed doesn't tell anyone, including Congress - but we have estimates) has grown much faster than the economy, the result is that currency has been steadily devalued over the past many years. Which is consistent with what we are experieincing here. Most would agree that it isn't getting easier in the US, it is getting tougher. Much tougher.

    At this point, the interest rate knob has been turned as far as it will go, and quite apparently has had no positive effect on the economy. So the Fed resorts to "Quantitative Easing". Which is essentially the Governemt printing money to pay their expenses. Hmmm. But every dollar they print devalues the currency further, so the things that the government has to buy can, for the most part, be expected to rise. Whihc means they will have to print more money. Kinda like they are doing now, even though they just did this a year or so ago. I don't know... does this course of action really make a lot of sense to anyone? If you have a problem you can't just print paper to make it go away. Paper has no value! You have to increase your production of GOODS AND SERVICES in order to generate wealth. Remember that we went of the gold standard in the 70s precisely because the value of the dollar was defined in terms of our industrial output, which had more value than the gold reserves held by the government. But today, the solution offerred by the economic brain trust at the Fed is... print more paper.

    One argument proposed by the Fed in defense of all this is that such actions are needed to float the Government because otherwise the Treasury will not be able to sell their securities. If they can't sell them, they will have to offer higher interest rates on those securities to attract buyers. The argument doesn't work though! The main reason that the Treasury can't move their securities is because buyers would have to be crazy to invest today's uninflated dollars in low interest bonds when massive inflation is GUARANTEED by the Fed's insane monetary policies - zero interest and printing currency like mad! In fact, many countries are so unhappy over this that there is talk of replacing the US dollar as the standard currency. And of course, they should be unhappy. They hold bonds that are steadily decreasing in value, just exactly like the US citizen is seeing his standard of living erode. The difference is, those holders of US debt bonds understand what is happening and are far less accepting than the US citizen appears to be. AS usual, the Fed's logic is nothing more than a circular argument that doesn't really solve anything, and causes a lot of collateral damage.

    Another argument put forth by Bernanke and the Fed is that devaluation won't hurt the US citizens since wages should track prices. Nonsense! There are 15 million unemployed in the US and the rate isn't going down. The Service Economy is replacing highly paid factory jobs with low paying service sector jobs. The result is that the total wage paid to Americans is not increasing, and shows no sign of increasing. Meanwhile, we are highly reliant on imports - most notably oil and imported consumer goods. All imported goods will increase in price as the dollar devalues. The problem is, in the US we not simply outsourced jobs, we have abdicated complete industries. We no longer have the ability to simply crank production up in US factories. Those factories are obsolete if the even exist any more. It will take years to recover. But we don't have years! Unemployment benefits alone are costing something like $250 Billion per year, and of course there is the double whammy since that massive unemployment isn't contributing to the economy OR helping to increase the Federal revenue. The whole mess is a non-solution. Just when you think that things can't get more screwed up, the Fed, as it always the case, proves you wrong.

    So... why exactly do we need them?

    Bottom line, we have the same or less money in terms of absolute dollars. But the dollars are worth less, and thus buy less. Because of the economic problems, government revenue isn't where it needs to be, and because the Fed's policies are devaluing the dollar, we can't find any suckers that will buy our treasury bonds. Washington, who has no vision, no economic redevelopment plan, and apparently even less sense, wants to increase the retirement age to 70 or 72, and are looking at cutting the Defense budget. Neither one of these will help the economy... in fact a recent report showed that increasing the retirement age will actually cost money. At the same time they talk about cutting defense - which at least buys us something valuable and keeps people employed - they pass out a trillion in stimulus... which has already proven (more than once – you can look at FDR’s results in the 1930s) to do more or less nothing to generate job growth. And the Fed is urging yet MORE stimulus, promoting less personal saving, and forcing the devaluation of our money.

    The economic shell games of the Fed are simply not going to work – ever. They will succeed in enriching a small number of profiteers and hence increase the gap between the few that have most of the money and the rest of us that have less and less. The solution is really simple, and there is only one. Get to work. Make more and better stuff and sell it to the world. Innovate and leverage what we are good at. Invest US money in US industry, which ios the only real means for creating a strong and wealthy economy. Change the rules to force a level playing field so that Americans can afford to do a very important thing – buy American made stuff. Worry about your own *ss and let the rest of the world worry about theirs. And most importantly, reject the BS promoted by those that have other interests. Their allegiance is not to the United States or to your health and well-being. Duh.

    Aaaargh. If all this were a fiction novel, it would never sell because it is so totally unbelievable.
    Last edited by Andy_M; 12-03-2010, 01:42 PM.


    • #17
      Re: Quantitative Easing Explained

      Andy, to clarify, I'm not defending devaluation, I also concur with your points on the detriments of doing it, we can go as far back as ancient Rome to see the effects of devaluation, we can also look at the reasons the Romans were forced to devalue for some eye opening lessons that we're currently failing to apply.

      My point is that in light of the current political and economic climate (surprisingly similar to the Ancient Roman senate), where the current administration is hard pressed to generate revenue's from those who have gotten filthy rich thanks to the Bush/Cheney policies, there is relatively little else they can do aside from Fed policy and devaluation, otherwise we're discussing cuts to seniors, vets, the disabled and a barrage of other flighty johnny-come-lately "ingenious" schematics to avoid dealing with the obvious at the expense of the majority that has already been crushed over the last ten years.

      Mindful again, I agree with your thoughts the Fed overcomplicates things and utilizes opportunities created by this convolution for their personal agenda.

      I also think an opposite extreme can be bad as well.

      For example-

      The individuals promoting the Fed's abolishment are the likes of the Pauls, Rand and Ron and a few other ideologically radical individuals who appear to be in need of a basic calculator.

      They both want a flat tax.

      Rand has a schematic that theorizes a flat federal sales tax would resolve our deficit, he completely and thoroughly misses a very important detail.

      For a flat sales tax to work, you have to be able to generate the same revenues the existing progressive rates do (actually, more than the Bush rates), in other words, a billionaire needs to outspend the percentage of his income by a much greater margin per capita than a worker who makes $30K who spends the bulk of his income by necessity just to survive.

      If you haven't done the math, trust me, a billionaire spends nothing near as much of a percentage of his income that a working stiff does, the worker (us) spends much more per capita of his income just paying for housing than a billionaire buying Ferrari's spends to generate that much sales tax.

      The gist of my mentioning this, the same individuals may be simplifying the Fed's function as well as the I.R.S and other agencies., I'm just not throughly convinced it's the best idea, but I definitely think transparency is absolutely necessary.

      Another concern I have, the Fed is definitely at fault, but we also need to see some accountability from the private sector for what transpired over the last ten years, it concerns me that for some the Fed may have become the sole target.

      Goldman Sachs, Citigroup and the other big banks knowingly perpetrated fraud in collusion with the ratings companies, and yes, I know they practically are the Fed, but the point is that when Goldman Sachs was finally held accountable for the economic decimation they became filthy rich off, they were hit with a massive fine of two days profits from their prop trading, a traffic ticket by median standards (did I mention the Roman senate?)....the day and age of a loose interpretation of a "free market" needs to end.

      The only "financial liberty" the Tea parties were fighting to protect from higher taxes and deregulation were the likes of Koch industries and Rupert Murdoch, who funded the "grass roots" protests to begin with.

      From where I stand on this discussion, it seems like transparency would be a happy middle ground, a common denominator.

      The thing that sucks, we both know it won't happen anyway, we're just rats in a cage discussing the cheese we see a foot away.

      But then, if there are enough of us speaking a coherent message together, politics can't avoid it forever.

      Last edited by DuckButter; 12-03-2010, 02:53 PM.


      • #18
        Re: Quantitative Easing Explained

        I totally, totally totally agree with you that the financial industry are... and I take liberty here.... a bunch of crooks. Reagan deregulated the industry... it was a big mistake, and I tend to think it happened because at the time Stockman et al didn't really fully understand the way the global economy was going to develop. They should have. They screwed up big time. But as you also mention, the large financial institutions ARE the Fed - and that's a big part of the problem. It's not just the domestic finanial giants. The global financial industry is the enemy, not just the Fed. My ire towards the Fed has to do with the fact that they are empowered to set monetary policy, which they do, behind closed doors, and to the utter detriment of the United States both as a country and a people.

        I actually think a lot of Ron Paul, although he is far from perfect. I do particularly enjoy his lambasting of the Fed. Rand is not Ron, and I don't find as much to like in him. But irrespective of goofy and unworkable tax schemes (which will never happen and even if they did are just rearranging the deck chairs on the Titanic at this point), their complaints against the Fed are, IMO, right on point.

        Fun discussion. I've enjoyed it.
        Last edited by Andy_M; 12-03-2010, 03:40 PM.


        • #19
          Re: Quantitative Easing Explained

          Andy, for an engineer, you're ok in my book.

          It might interest you to know, Stockman was on CNN's Fareed Zakaria GPS this weekend. complaining that lower corporate and upper class taxes are doing this country in.

          Also, heres an incredibly interesting article from Paul Craig Roberts, co-founder of Reaganomics on the current extreme special interest conservative movement, a MUST READ for someone like yourself:

          I mentioned this before and it bears repeating, one of the strongest arguments for the political pundits and Wall St naysayers like Kudlow and his rich commentary pals against Obama's attempt to repair the broken tax code has been "REAGAN".

          All the while, the founders of Reaganomics are all but openly admitting Reaganomics has failed miserably, hilarious.

          We need to rethink 1986, and we need to do it asap.

          A tenfold increase in consumer debt, with wages failing to at least rise at the same rate as GDP since 1986, in conjunction with CEO salaries multiplying tenfold is a very, very bad thing.

          We inadvertently reintroduced the same set of variables that were in place in 1929, almost identically.


          • #20
            Re: Quantitative Easing Explained

            I just fell into this article, comparing commonalities between now and other major U.S. crisis's that inevitably led to war.

            I paints a dark picture and reminded me of my comparison to the Weimar Republic.

            I hope this is completely wrong, that our government wakes up, smells the strife and does the right thing instead of feeding public fear and anger.

            An excerpt -

            "A Crisis era begins with a catalyst – a startling event (or sequence of events) that produces a sudden shift in mood.

            Once catalyzed, a society achieves regeneracy – a new counterentropy that reunifies and reenergizes civic life.

            The regenerated society propels toward a climax – a crucial moment that confirms the death of the old order and birth of the new.

            The climax culminates in a resolution – a triumphant or tragic conclusion that separates the winners from losers, resolves the big public questions, and establishes the new order."

            Full article -


            • #21
              Re: Quantitative Easing Explained

              Here's an article that, as it's title suggests, will make you weep.


              • #22
                Re: Quantitative Easing Explained

                Great article Plumbus, it sums my concerns, where Andy and I differ.

                Not in any way intended to knock Andy, who's obviously well versed in the specifics on the economy, but I worry like hell that we've become too acclimated to the serendipitous way the industrial revolution made us a superpower, assume it will continue and we have nothing to worry about, no need to adapt or change the status quo.

                What was once "America ingenuity" is now becoming "Global ingenuity", this is actually a good thing in terms of global specialization and efficiency, just not so good for the American middle class in the interim while we adapt, or at least once the fine minds in Washington finally realize this problem and alter policies that are currently crushing the median.

                I partially think they (Washington) already know the problem and knowingly want to continue an agenda that benefits themselves until they can't any more, once it's too obvious to the general public.

                QE will help for now the way a sugar rush does for the quarterback at half time (or not), but even Bernanke is trying to get that point across that it's not going to be enough. it might only serve to mask the real problems in our foreign trade, tax, and regulatory policies that only benefit big campaign contributors.

                It's very encouraging here to see that middle class, laymen, workers are paying attention to all this, an extremely important, albeit confusing topic.

                I say this because until these things become household phrases where the majority of voters know the how and why of what is happening, those in the position to benefit from the status quo will continue to misinform the public using fear or anger for their gain.

                And now, Bernanke's on 60 minutes, gotta watch this...
                Last edited by DuckButter; 12-05-2010, 07:04 PM.


                • #23
                  Re: Quantitative Easing Explained

                  I'm glad to see this sort of article. To me it means that a few more people are finally waking up to the fallacy of the "service economy", the great hoax that is leading to the dismantling of the USA. Some of us have been railing against the insane notion of a service economy for 40 years. You gotta make stuff to have a real economy.

                  The game is not over unless we decide it's over. It is not too late, but it soon will be. One thing is for certain - we can't afford to twiddle our thumbs and let time pass. At the end of WWII, we were passed the baton as leaders of the free world. We earned that distinction based on the hard work and ingenuity of our parents and grandparents. It is not our birthright. It takes constant work, work, work -- sweat, sweat, sweat. Not borrow, borrow, borrow -- buy, buy, buy.

                  While Americans are preoccupied with Facebook and American Idol, we fail to notice that in other countries, they are preoccupied with science and calculus. Our kids think it's cool to wear their pants below their butts. We stereotype the kids that do well in math and science as nerds and geeks. To borrow thier language....OMG!

                  A couple of years ago, I heard a young Asian woman read an essay she wrote about her experience growing up Asian in the US. In part of it, she commented on how she struggled mightily with high school algebra. This surprised her friends, since as an Asian she was stereotyped as being naturally good at math. Her analysis was that Asians were no better than anyone else at math or science. She certainly wasn't. The difference, she reckoned, was the attitude of the parents. American parents, she wrote, told their children that it was all ok as long as they did their best. The problem she saw was, "How does anyone know - really know - if a kid did his best?". In contrast, her parents, and she said Asian parents in general, simply wanted results. They wanted to see the A on the report card. She gave them the A in math.

                  Boy, talk about hitting a home run.

                  In the US we study history and economics and then, apparently, forget it the day after the exam. I am amazed to see on this very forum where some come out and say they have no interest in all this "bank BS". Would they not care if someone accessed their savings and took out 20%? Are they sufficiently in the dark that they don't see that this "bank BS" is exactly that?? Yes these topics are dry. They don't have the emotional zing of gay marriage or wikileaks or Lindsay Lohan. Maybe that's just another embodiment of the problem with this Country.

                  I think there are a few old school constitutionalists left, a few that paid attention during Econ, a few that know what BS smells like. Maybe I'm wrong. If so, then we truly are done. Just in case, I have two suggestions: invest in gold, and buy shotgun shells. Both will be handy. In fact, I am doing both those things.

                  As for QE2, I am 100% sure, as the sun will rise tomorrow, that there isn't anything good about it, and that it is yet another step closer to collapse of the dollar. We are being told all kinds of nonsense in circular arguments about why it is necessary. One is that increasing the money supply and devaluing the dollar make our exports more atttractive and thus stimulate industrial production. It won't, for the simple reason that here in the US, we have let most industries not just go offhore, but die completely. You cannot stimulate what isn't there. The fact is, prices of imports WILL go up... but we will continue to buy them. We cannot ramp up domestic production - there is nothing left to ramp up. Re-industrialization of the US will take years. The instant infusion of $600B, like the infusion $2T before, will temporarily make the economy's numbers look better. Ben Stein and the other economic numbskulls will tell you that the recovery is on, full force! But that money will all end up overseas, because there is no plan to focus the money on rebuilding US industry. And then, once the $600B is gone, we will be much worse off.

                  Let's be clear about what is really happening. The Governement, as we all know, runs a deficit. But in order for them to actually function, they need cash so the checks don't bounce. To get the cash, they rely on borrowing. Right now, due in large part to the economic moves of the past 2 years (much longer, really), the international community is very reluctant to purchase US bonds (loan us cash). This is because between artificially low interest rates, Federal Debt, and the Fed's willingness to simply print paper, it is clear to these folks that our bonds are going to decline in value! Not so good. The Goverenment could increase the interest they pay on the bonds, and then they would sell. But they know that because the economy (despite their public nonsense) is in such poor shape that they can't afford to pay more interest. The debt service, as it is, is on track to bankrupt the United States Government in our lifetime.

                  Now, the Fed and Obama administration want you to believe that this move will stimulate the economy. It won't. It's all a shell game to hide a very simple reality. QE2 will devalue your money. Your cash assets - such as savings & CDs, as well as your accounts receivable, will be worth less. Via QE, YOU ARE THUS PAYING FOR THE GOVERNMENT DEBT. This is NOTHING MORE THAN A TAX INCREASE.

                  In the same way, the artificially low interest rates that the Fed has created over the past many years is exactly the same thing. It's a TAX.

                  I repeat, QE, along with low interest rates, are all a clever way of TAXING you. And it's not a couple bucks, either.

                  Nevermind all the current BS about extending Bush tax cuts and no increases for anyone making less than $250K. The politicians, both parties, want you to believe this nonsense. While they appear on TV and pat themselve on the back for not raising taxes, the simple fact is, THEY HAVE ALREADY RAISED YOUR TAXES MUCH MORE via this crazy "monetary policy". They know exactly what they are doing - these people aren't that stupid... well ok some of them are, but many of them know full well what is going on.

                  Don't drink the Kool Aid! Use your common sense. The Government needs cash to finance their debt. They can't get it from other countries, because the other countries are not stupid. So they print more money, and use it to buy their own debt. It's a shell game, the effect of which is, it devalues YOUR wealth. This scam results in YOU PAYING FOR THE FEDERAL DEBT, and for you it's not a LOAN that you'll get back with interest, it's a tax.

                  PLEASE write your congresspersons and Senators an tell them not just NO but HELL NO.

                  As far as the de-industrialization of America goes... and I know I'm a broken record.... BUY USA-MADE or don't buy at all, whenever you possibly can. And let the CEOs of Apple and HP and yes, Ridge Tool know what you're doing.
                  Last edited by Andy_M; 12-05-2010, 09:21 PM.


                  • #24
                    Re: Quantitative Easing Explained

                    Originally posted by Andy_M View Post

                    In the US we study history and economics and then, apparently, forget it the day after the exam. I am amazed to see on this very forum where some come out and say they have no interest in all this "bank BS". Would they not care if someone accessed their savings and took out 20%? Are they sufficiently in the dark that they don't see that this "bank BS" is exactly that?? Yes these topics are dry. They don't have the emotional zing of gay marriage or wikileaks or Lindsay Lohan. Maybe that's just another embodiment of the problem with this Country.


                    Though I wouldn't expect every American to suddenly adopt a level of understanding equal to that of an Ivy League PHD, it would sure as hell be nice if it weren't completely discarded as a waste of time or irrelevant.

                    The entire country has been taken advantage of, and ironically, most of us aren't yet aware of it.

                    Also, regarding your thoughts on our politicians knowing they're screwing us.

                    I largely think the "screwing" is more split between the political side, and the intentional legislative manipulation of the corporate lobby, the obvious logistical result of a system where legislation is done at the behest of money, bribery by another name, newly enhanced thanks to a Supreme Court decision.(who's also bribed)

                    That difference is minimal though, with the same end result and the same solution to fix it.(Fix campaign finance, change to a general fund that all candidates get an equal part in, prohibit direct bribery)

                    If, as you note, we were adhering to the Constitution and not allowing bribery, we wouldn't have these problems in the first place.

                    One last note, to your suggestion on Gold, short treasuries too, QE will stop one day and when it does - "thud" like a rock. ('course, tonight Bernake says it could go on for a lot longer)

                    I got short when the ten year was at 2.35%, my timing was lucky, but this is a thirty year low in rates, and if China finally gets sick of funding our stupidity while we're busy publicly lambasting them for currency manipulation, that bubble's gonna pop like the Hindenberg.

                    Last edited by DuckButter; 12-05-2010, 10:07 PM.


                    • #25
                      Re: Quantitative Easing Explained

                      I should probably point out something that might not be obvious to everyone.

                      The Fed (heli-Ben) has repeatedly stated that they believe that deflation is a much more serious issue than inflation. The reasons for this belief are actually pretty weak, but no matter.

                      The point I want to make is that in terms of general prices, we really aren't seeing anything remotely like deflation. Groceries are going up. Energy is going up (not just gasoline, but all energy). Also healthcare, clothing, education, cars, appliances.... just about everything.

                      Except one thing, that has declined in price seriously. Real estate. And becasue the employment situation looks so crappy, it probably isn't done yet.

                      Real estate in the US is bought via long term loans, right? So who really owns it? Exactly. The note holder - a financial institution.

                      The point is, low interest rates and a de-based dollar both will help prop up real estate prices. That's the deflation the Fed wants to halt. They are protecting the assets on the balance sheets of the banks.

                      Once again, it doesn't have a lot to do with your best interests. It has to do with the interests of the financial industry. All the stuff that you have to pay MORE for is of no concern to them.... those things aren't on their balance sheet.

                      The financial industry is not your friend, no matter how earnest Ben seems on 60 minutes.
                      Last edited by Andy_M; 12-06-2010, 01:01 AM.


                      • #26
                        Re: Quantitative Easing Explained

                        Rates, I mentioned this before, it bears repeating - we can't afford rates to go up until we have jobs back and steady revenues from those jobs because just a couple of percent increase in rates would overwhelm out current revenues to service debt, another argument for increasing corporate, upper class taxes.

                        It concerns me that Bernanke didn't mention this tonight, but focused more on GDP growth and deflation, which I suppose doesn't sound as gloomy, but makes me wonder if he's sugarcoating.

                        It's twisted, while the corporate lobby is running our government, refusing to allow our political puppets to make any increases in taxes or stimulus spending, meanwhile not hiring in America, the Fed is treading water to offset this stupidity.

                        The Fed is the only entity that has a hand that isn't (maybe) under the control of the corporate lobby, which then leaves pause to question the Repubs recent talk of eliminating the Fed's dual mandate, what's their motive here?

                        I'm not trying to defend the Fed, but to see the grey area, it's definitely not all black and white.

                        Bearing in mind, this is only conjecture, which is why I'm not on the side of abolishing the Fed, but making it transparent.

                        To add, regarding real estate values.

                        Fed policy under Greenspan was intentionally used to pump the real estate market to offset the tech crash, Greenspan now admits this, basically transferring one bubble to another.

                        He also admits to knowing CDO's were going to be a problem, claims he couldn't figure out what they were so he left it to the free market. (a crock)

                        My opinion, Greensapn should be scrutinized for this, I'm not as sure that Bernanke is so much the bad guy, yet, but dam, if the Fed were required to show us the books periodically, we could at least do more than read between the lines, guess or jump to conclusions.

                        Last edited by DuckButter; 12-06-2010, 01:52 AM.


                        • #27
                          Re: Quantitative Easing Explained

                          Love those Lil Bears. Funny I watch them and 15 mins. later da Bernakie is on 60 Minutes! THE TWILITE ZONE !
                          I can build anything You want , if you draw a picture of it , on the back of a big enough check .


                          • #28
                            Re: Quantitative Easing Explained

                            We can't afford to wait for jobs to come back. It's a chicken-and-egg problem. Jobs aren't coming back until we can get this problem solved. There are going to be some hard times. I agree with Peter Schiff completely... there is no way around it. Debt service is currently 8% of the Fed budget. Better to take our medicine now rather than wait 10 or 15 years when it will be 30-50% of the Fed budget. Then all we will be able to do is lament how great the US once was.

                            Low Fed interest rates don't help the people, they help the banks. The money is STILL not being lent. The banks are reporting very large profits over the past few quarters. Since they aren't making loans, where is the money coming from? They are taking essentially interest free money from the Fed... and buying treasury bonds! See the circle there? We are providing interest-free money to the banks, who are then turning around and collecting interest from us on our debt bonds! There is no-none-nada benefit to the taxpayer, it's a scam to collect YET MORE of the American taxpayer's money. Yet another brilliant move by the Federal Reserve and the Treasury department.

                            But we didn't see THAT on 60 Minutes, did we?

                            Duck, you make it sound like the Fed are the white hats trying to keep things afloat. I strongly disagree. They are clearly the enemy.

                            Corporate lobbies are certainly not working in our interest, but IMO it's the financial community, through the Fed and behind closed doors, that is the much stronger motivating force behind the problems.

                            Note that the 3.3 trillion spent by the Fed since late 2008 included bailouts to private companies. Tax money being funnelled to companies like General Electric?? What the &*(* ?? Without congressional approval or even knowledge? While GE has been steadily offshoring tens of thousands of jobs for the past 20 years?

                            The facts continue to speak much louder than Bernanke.
                            Last edited by Andy_M; 12-06-2010, 01:46 PM.


                            • #29
                              Re: Quantitative Easing Explained

                              Things aren't so rosy in Europe either. Here's Nigel Farage taking a few swipes at the EU braintrust.


                              • #30
                                Re: Quantitative Easing Explained

                                The financial criminals know no nation or boundaries. It's all just money, they want it all, and they are convincing everyone - not just US citizens - that it's all good for them. Despite the hugekly mounting evidence that just the opposite is true. Funny how no matter what governments or banks do, the banks end up making money. Funny... but not surprising.