Apparently, the Harvard Law grad in the White House agrees.
Posted on 05/21/2009 11:55:31 AM PDT by reprobate
I share the concern about hyper-inflation. But tell us, is there another solution to a deep deflation, other than inflation?
“How will we avoid hyper-inflation, somebody tell me?”
Abolish the Fed. Restore a free market in money.
Am I kinda correct....every single failed bank that came up over the past six months....was run by Harvard grad’s?
“But tell us, is there another solution to a deep deflation, other than inflation?”
Yes. Let prices decline. Save capital. Produce more.
“Am I kinda correct....every single failed bank that came up over the past six months....was run by Harvard grad’s?”
I don’t think it was 100% Harvard, but damned close ... the others were like minded Ivy League schools I believe.
The economy has to start to grow again before inflation becomes a problem. If the economy doesn't grow, which seems to be the intent of this administration, inflation will just be an academic debating point.
Apparently, the Harvard Law grad in the White House agrees.
We will change the way we measure inflation: we will change the way we report on the status of the money supply, we will change the composition and weights of baskets of goods used to calculate various economic indexes, and we will apply subsidies to enough (now) highly-weighted goods still contained in those baskets to appropriately screw with measures of the GDP deflator, CPI, PPI, PCE, etc. Everything suitably justified of course.
At the end of the day, we will report that inflation is tamed to some very low number, and you will have to accept that YOUR experience (and that of everyone you know) is just anecdotal.
Is that why Zimbabwe has hyper inflation, because of growth?
I don't think so.
OK, then.... What fun their meetings must be.
Along with the country (Bush, Harvard MBA) and the Treasury (Paulson, Harvard MBA), GM (Wagoner, Harvard MBA)... the list goes on and on and on.
Harvard is a cancer upon the land.
Be careful what you wish for.
Because you might just get it.
We have an over-inflated money supply, but it's not that over-inflated. Our bond rating is triple A headed towards double A. Zimbabwe doesn't even have a rating anymore.
I haven't read any conservative economist that thinks inflation will be a problem without a return of growth to the US economy.
“Be careful what you wish for.
Because you might just get it.”
I’m not scared. If the free market works for every other commodity, why not money? Plus, there are historical examples.
Politics and economics shouldn’t mix. What Obama and the Dems are doing to the economy hasn’t ever worked anywhere on Earth. Yet we are being led over the cliff like lemmings. What statemen these politician are, Dem. & Rep. They sicken me. DO THE RIGHT THING, DAMN IT!
This is exactly what the PRC is advocating when they call for an end to the dollar as the world’s dominate reserve currency and for the adoption of the Bancor as the world’s reserve currency.
If the PRC (and other nations who are beginning to come around to the PRC’s position) is successful in this, watch out, there’s going to be a period of rather severe adjustment for Americans - rather like the 70’s, where we have inflation and high unemployment (which Fed economists will still tell you ‘cannnot happen at the same time’).
“I haven’t read any conservative economist that thinks inflation will be a problem without a return of growth to the US economy.”
Inflation is a problem in any case. It always distorts the market. It’s just never as big a problem when we’re not in, or heading toward, a boom.
What i want to know is, am I wrong to be concerned. The Dem's and the media seem to believe that the feds will control the money supply perfectly (this time). I just don't think it's possible.
In an import-heavy, service-based debtor economy such as ours... you should be scared. Very scared.
If we had the financial soundness of the 1930’s (funny to say that, but yes, we as a nation were more fundamentally sound then than we are now), it wouldn’t be a big deal.
But in today’s kabuki theatre of finance? Oh yea... elimination of the Fed would be rather interesting.
Because you see, you’re forgetting that the Fed has TWO missions. You’re thinking that the Fed acts only as the ECB does — promoting sound money, setting interest rates and that sort of thing.
The Fed’s other mission - euphemistically called “open market operations” comes into play when the turds hit the turbine blades in stock, debt and derivatives markets. Without the Fed in place last October, Wall Street would have imploded. Not just Lehman — ALL of them would have imploded. AIG would have imploded. And when AIG went down, there would have been immediate coupling to European banks, who would have then back-coupled over here.
One of the reasons why the dollar/euro trade reversed so suddenly and resoundingly last autumn is that it became painfully clear that the Euro is a currency without a single Treasury behind it, and that the ECB did not have any clue what to do as a “lender of last resort” as the Fed knows how to do. The reason why everyone piled into T-bills and Treasuries in October/November was that the world knew that the Fed was there to backstop the US financial system.
Now, as sympathetic as I am to the idea of getting the Fed’s mitts out of money markets, we have to address the issue of “who backstops the financial sector when (not if) they implode?” Because they do, you see — about every 60 years, the bankers blow themselves up - and the rest of us get wounded by flying bits of shrapnel, rich hand-polished bits of teak and other fine woods as their desks go flying hither and yon, and the occasional bit of flying bone fragment from the bankers themselves.
This is not the first time the banking system of the US has melted down; It happened in 1873 - and there was no Fed. It happened in 1837 - and the precursor to the Fed went down with them. Both times, the knock-on impacts were severe and long lasting. It happened in 1932/1933 and the Fed did many wrong things, making it worse.
This time, the Fed has done some things right, some other things wrong. On the whole, they’ve done more things right than they did in ‘32/’33, but they still don’t have a SOP manual for “When Bankers Blow Themselves Up: A Handbook for the Fed Chair and President of The FRBNY...”
Part of our problem this time is in one man: TurboTax Timmy. He was head of the FRBNY - and this is the bank where we need someone who really knows the markets and banks well. Timmy is clearly out of his depth in both subjects.
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