Posted on 09/21/2007 1:25:12 AM PDT by oblomov
In today’s testimony before the house, Fed Chairman Bernanke was questioned by Representative Ron Paul in what was a remarkable exchange. Remarkable for how straightforward, lucid, and anti-statist the question was. In his questioning, Ron Paul stated:
“I want to follow up on the discussion about moral hazard. I think we have a very narrow understanding about what moral hazard really is. Because I think moral hazard begins at the very moment that we create artificially low interest rates which we constantly do. And this is the reason people make mistakes. It isn’t because human nature causes us to make all these mistakes, but there is a normal reaction when interest rates are low that there will be overinvestment and malinvestment, excessive debt, and then there are consequences from this. My question is going to be around the subject of how can it ever be morally justifiable to deliberately depreciate the value of our currency?”
His statements continued (about how much oil, gold, wheat, corn, etc. has gone up since the rate decrease) but the heart of his question was the following moral question: ...consciously depreciating the value of the USD has winners and losers (Wall Street/banks/the rich and everyone else), Mr. Bernanke. How do you constantly choose Wall Street over the rest of America?
You will not be surprised to know that B-52 Ben didn’t answer the question. He couldn’t answer the question (at least truthfully). Was he going to say that the Federal Reserve is a quasi-private institution whose prime directive is to cartelize and protect the profits of the banking industry? Was he going to say that the only policy the Fed knows is based on the flawed Keynesian logic that wealth can be created out of thin air via printing presses? Of course not.
(Excerpt) Read more at minyanville.com ...
Untrue.
If Ron Paul were in charge his first act would be to stabilize the currency by raising interest rates.
That would be bad for gold, but that's the whole point.
Stop devaluing the dollar and there will be no need for gold except to back the dollar.
BUMP
No disrespect, but can the President actually raise interest rates?
Riiight....
Do you realize countries that backed their currency in dollars were the countries that suffered the worst and the longest during the Great Depression?
First to your senario: Yikes...
Second very true, they do play like it’s 1901. Those nuke thingys are just fiction.
What an asinine question.
And talk about class warfare. Wall Street is simply a place where "the rest of America" invests their funds and demands a return on their investment for their risk in doing so.
If someone is "stumped" by this guys questions it would be because he strings so many false associations together in one query.
by stopping muslim immigration?
I really like that concept. If anything, it’s a start. Wouldn’t it be great to try for a 4 or 5 year term??
Now if we can get that little parcel of land bordering Mexico secure, we may have something.
You’re late, WWTD used that lame joke first, and your beanie hat’s propeller is missing.
I’m glad you know so much more about economics than Walter Williams, who has endorsed Ron Paul. Nice going, Kreskin.
Paul, or for that matter, any other elected in 08 may not have a chance to show what they could do. W is allowing the dollar to really tank.
Oil, as most experts are predicting should be hitting close to 100.00 dollars a barrell soon. That should equate to about 4.00 plus dollars a gallon. Lets hope mom and pop can afford public transportation or many other working stiffs as well.
I think I'll play in the sandbox with Williams. You can keep spewing idiotic predictions from your litter box.
Agree.
Bush Sr lost most of the voters after his “no new taxes” went south. If you look at Bush during his failed re-election, he looked defeated from the very start. Dole on the other hand was kind of the token republican candidate. As though the party owed him something for his service. Hope we do not make the mistake again with McCain.
I’m with you. His domestic policy views are SO PERFECTLY RIGHT!
But geezlouise, how can he be so naive about the war?
I disagree with you 180 degrees on your economic take. Yes, there would be upheaval, as the Fair Tax and the gold standard took root, and the artificial crap that’s propped us up shook out. But it would happen slowly, not ‘the day after he was elected’. Let’s be honest though- this economy is based on fiat money and a larely fake market. We desperately need a dose of reality and a prioritization of genuine wealth.
“Thought” well there is the rub....
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