Bernanke: I Can't Quit You, QE

Discussion in 'Economy' started by Twalbert, Aug 2, 2011.

  1. Twalbert
    Offline

    Twalbert Member

    Joined:
    Jul 19, 2011
    Messages:
    71
    Thanks Received:
    24
    Trophy Points:
    6
    Ratings:
    +24
    It might be time to just put all of your money into a pile in the front yard and burn it.

    There is nothing in the economic data this month to suggest that the economy is turning around. Unemployment sucks. Manufacturing sucks. Housing sucks. The Republicans just — quite successfully — held the country hostage to get some policy concessions passed.
    Doesn't it seem like President Obama is two more stupid decisions and a bad mustache away from watching the United States become a third-world hellhole?

    It was only two years ago that economists declared the end of the recession. Jobs were to come next, right? And yet, here we are, millions still unemployed with no relief in sight. Unemployment benefits have long since run out for many Americans and the jobs are still not there. Wages for the jobs that do exist are not rising, and that has left America's economy needing one thing: consumer demand.

    This is one thing that Main Street has known for two years and Wall Street seems to be coming around to understand: the so-called recovery never happened. It just didn't happen. Zeus knows we tried to fix it. We had a stimulus bill to try and jump start the economy. What happened? Republicans doomed it by insisting it be too small to work. Democrats tucked their tails in and went along with the Terrorist Tea Party precursors and passed a too-small stimulus package. End result? It didn't work, because it was too small.

    Good luck getting another one passed...

    Over in Federal Reserve land, Ben Bernanke has been playing a fun little shell game called "Quantitative Easing". Economists used to call this sort of nonsense "printing money faster than it could be spent", at least before the United States embraced itself as a banana republic.

    The idea behind QE is simple: prop up asset prices and prevent deflation. Does it work? Well, maybe. It depends on what you're looking to do. If the goal is temporary spikes in commodity prices and instability in the commodity markets, then yes. If the goal is a permanent reset of the economy so that things become manageable and growth can begin, then no.

    And yet, here we are, sitting on the edge of a third round of QE, just whistling at the debt piling up while waiting for Bernanke to get the call from Hell to go ahead and unleash a third round of cheap dollars on the world.

    For his part, Bernanke insists that QE3 isn't coming. He is, as usual, full of it. The economy is in dire straights. Manufacturing fell again, and barely registers as growing. And while that is all awful and points toward some sort of intervention, there is one word that people are tossing around that scares the bejesus out of Bernanke: Deflation.

    Yes, that's right. Deflation. We live in a world where the price of everything important goes up and up, and yet, deflation is here. (It's a bit like thunder snow in June, I suppose.) Look at the facts.

    Facts That Make Bernanke Cry

    The Consumer Price Index has gone from 0.5 (March 2011) to 0.4 (April) to 0.2 (May) all the way to -0.2 (June).

    The Producer Price Index has gone from 0.9 (March 2011) to 0.8 (April) to 0.2 (May) all the way to -0.4 (June).

    The U.S. Import Price Index has gone from 3.0 (March 2011) to 2.5 (April) to 0.1 (May) all the way to -0.5 (June).

    In other words, deflation isn't a future threat; deflation is happening right now. Deflation plus a crappy economy means, sooner or later, Bernanke is going to bust out his QE3 stick and start smacking skulls around.

    ACTION ITEMS:

    Bullish:
    QE3 is going to happen. The economy looks to be falling off a cliff. This is no soft patch. Deflation might already be here. Investors should pile into gold (NYSE: GLD), silver (NYSE: SLV [FREE Stock Trend Analysis]), oil (NYSE: USO), and agricultural stocks such as Potash (NYSE: POT), Monsanto (NYSE: MOS [FREE Stock Trend Analysis]), Agrium (NYSE: AGU), as well as miners such as (NYSE: FCX).

    Bearish:
    QE3 will be the death knell for the U.S. Dollar. It will be lights out. Investors could buy the PowerShares DB US Dollar Index Bearish ETF (NYSE: UDN [FREE Stock Trend Analysis]).

    Source: Benzinga
     
    • Thank You! Thank You! x 2
  2. CrusaderFrank
    Offline

    CrusaderFrank Diamond Member

    Joined:
    May 20, 2009
    Messages:
    81,221
    Thanks Received:
    14,910
    Trophy Points:
    2,210
    Ratings:
    +36,990
    If he does QE3, but never announces it, is it still happening?

    I'm seriously considering changing my career from real estate to commodity trading. I started at EF Hutton (Yes, I go back that far) and was going to be a commodity trader, then took a long detour to real estate.
     
  3. Baruch Menachem
    Offline

    Baruch Menachem '

    Joined:
    Sep 12, 2008
    Messages:
    14,204
    Thanks Received:
    3,235
    Trophy Points:
    185
    Ratings:
    +3,305
    Behrneke is trying to be the adult in dealing with a fiscal crisis with monetary means. He just doesn't' have the tools to make it work.

    The US economy is no longer big enough to support the debt. Most of which is held outside now, which is different from when Roosevelt could sort of pull it off. We can't do QE to the poing that outsiders feel the dollar is no longer a safe investment. And that could happen on a dime.
     
  4. Mad Scientist
    Offline

    Mad Scientist Deplorable Gold Supporting Member Supporting Member

    Joined:
    Sep 15, 2008
    Messages:
    23,940
    Thanks Received:
    5,211
    Trophy Points:
    270
    Ratings:
    +7,680
    In the real world, when a CEO fucks up he gets fired.

    In Bernanke's world, when he fucks up he just prints more money.
     
  5. Trajan
    Offline

    Trajan conscientia mille testes

    Joined:
    Jun 17, 2010
    Messages:
    29,048
    Thanks Received:
    4,751
    Trophy Points:
    48
    Location:
    The Bay Area Soviet
    Ratings:
    +4,756
    we've had an all encompassing QE3 thread running for a while..
    http://www.usmessageboard.com/economy/167237-qe-3-a.html


    its all part of the plan.....by COB Sept it will be 'on'...bernbank is just stocking up on toner right now.
     
  6. editec
    Offline

    editec Mr. Forgot-it-All

    Joined:
    Jun 5, 2008
    Messages:
    41,427
    Thanks Received:
    5,598
    Trophy Points:
    48
    Location:
    Maine
    Ratings:
    +5,617
    The solution to the crises is to set up conditions where Americans makes things and sell them to Americans and foreignors, too.

    Of course that is NOT on either the Ds or Rs agenda, so we can pretty much expect no relief from this steady erosion of the US economy.

    Free trade?

    How FREE does it seem, now, citizens?
     
  7. Stashman
    Offline

    Stashman No Soup For You!

    Joined:
    Jul 17, 2011
    Messages:
    740
    Thanks Received:
    66
    Trophy Points:
    28
    Location:
    America
    Ratings:
    +66
    I have been very active since joining this message board at sharing the very important issue of ending the Fed. This is NOT a government controlled entity and is in reality a banking cartel. The Federal Reserve has NO government oversite at all. NONE! The U.S. Government can not even audit the Fed.

    The Federal Reserve System was enacted in 1913. Today our dollar is valued at 4 cents as compared to what it was back than. The reason for this is that our money is not backed by anything. Not gold nor silver, and it is printed out of thin air. Each time it is printed it devalues the money already in circulation. If it had been backed by gold than today our U.S. dollar would have the purchasing power of over $22.00.

    Here is a recent quote from Senator Ron Paul:

    "What should bother Americans most is that under cover of this debt ceiling circus, we learned from a recent GAO one-time, limited audit that the Federal Reserve secretly pumped $16 trillion into American and foreign banks over three years. All of the Fed’s fat cat cronies were taken care of at the expense of the American public."

    "To put that into perspective, our entire national debt is $14.5 trillion, and our annual deficit will be about $1.6 trillion, meaning the Federal Reserve created and appropriated more than our entire national debt to banks around the world in a few short years. We have been fighting in Congress these past few weeks over raising our debt ceiling by $2 trillion, an amount the Fed secretly gave away to just one big bank."

    Ron Paul .com

    Ron Paul 2012
     
  8. ShackledNation
    Offline

    ShackledNation Libertarian

    Joined:
    Jun 16, 2011
    Messages:
    1,885
    Thanks Received:
    208
    Trophy Points:
    130
    Location:
    California
    Ratings:
    +324
    Free trade is one of the reasons unemployment is lower. It is a myth to think a trade deficit is a bad thing. There are two sides to the balance of payments equation: the current account (which we currently have a deficit it, called the trade deficit) and the capital account (which we have a surplus of equal size to the deficit in).

    All dollars ultimately must come back to the United States. Foreigners must pay their workers in local currency, not dollars. Dollars are only useful in buying US goods or investing in the United States. If the US does not have goods to sell that foreigners want, they will invest their dollars instead. And that is exactly what they are doing.

    People complain about the US outsourcing jobs. In fact, foreign companies outsource over twice as many jobs to the US as we outsource to them. Not only that, these jobs pay significantly higher wages on average than domestic jobs. If it were not for free trade, the US unemployment rate would likely be 4% higher.

    And if those US workers spend the invested money on foreign goods, it will simply come back to create more investment in the US. Ultimately, the money will end up being spent on US goods. This spending will come from domestic consumers however (With money provided to them because of foreign investment) hence you have a trade deficit and a capital account surplus.

    Free trade functions to raise efficiency and lower prices, thus raising real wages and the standard of living. It has worked across state borders, and it works across international borders. Free trade (not fair trade agreements like NAFTA) is exactly what we need.
     
  9. iamwhatiseem
    Offline

    iamwhatiseem Gold Member

    Joined:
    Aug 19, 2010
    Messages:
    14,822
    Thanks Received:
    3,114
    Trophy Points:
    260
    Location:
    Virginia
    Ratings:
    +6,101
    QE3 has already started.
     
  10. Stashman
    Offline

    Stashman No Soup For You!

    Joined:
    Jul 17, 2011
    Messages:
    740
    Thanks Received:
    66
    Trophy Points:
    28
    Location:
    America
    Ratings:
    +66
    Hate to lay this on ya dude.

    American Chronicle | Treason Abounds ~ Gov't Cabal Plots North American Union (NAU)
     

Share This Page