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Posted on 11/14/2010 2:18:32 PM PST by cj in tx
Charles Ortel, managing director of Newport Value Partners, tells Accuracy in Media in an exclusive interview that the Federal Reserve plan to buy $600 billion of U.S. Government securities “borders on the criminal” because the impact will be the devaluation of the dollar by 20 percent and the destruction of $10 trillion of household net worth.
“Any potential benefit to GDP and incomes [from the Fed’s action] pales in comparison to the wealth loss (in real terms) and to the damage done to foreign investor confidence,” Ortel says.
Ortel, who has been critical of U.S. economic and monetary policy under President Obama, fears that “investors will run faster from the dollar and we may soon experience the sizeable pain that comes when foreign capital rushes for the door.”
Ortel has publicly warned that the Obama Administration has been pursuing what amounts to “destructive” policies that endanger the American capitalist system through rising levels of government debt and spending. On CNBC, he first warned in May 2009 that the administration seems to be waging a “war on capitalism.” In February of this year he warned that there is a very real risk of a U.S. default on a total debt of over $50 trillion.
With the Fed’s new move, the “war on capitalism” has become an even more debilitating “war on wealth,” he says.
(Excerpt) Read more at gulagbound.com ...
War on Wealth
War on America
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...”Ortel says it is time for the Congress to demand accountability from the Fed. He tells Accuracy in Media, “I definitely think the Fed (and all central banks) should be required to prepare meaningfully incisive, timely statements of their financial condition (as should all government entities and any corporation that issues securities).” It is time, he says, to have a rigorous and comprehensive look at the balance sheet of the Federal Reserve”...
...”“Devaluing the dollar, which is the direct consequence of QE2 by 20 percent (Bill Gross of PIMCO has this estimate) immediately knocks $10 trillion off of household net worth which borders on the criminal. Any potential benefit to GDP and incomes pales in comparison to the wealth loss (in real terms) and to the damage surely done to foreign investor confidence.”
He adds, “Resorting to another round of QE tells the world plainly that the Fed is out of effective ammunition and simply grasping at straws.”
Ortel predicts a “coming shakeout” and a new global regulatory regime that will emerge “after a great deal of financial (and I hope not real) blood has been shed.”...
Shut up and be a good peon. It’s what big government is all about.
1) It’s not guaranteed to devalue the dollar. M3 took a nosedive. If they unwind this at the right time, it might not cause inflation or devalution.
2) How do they figure Households lose $10 trillion if a 20% devaluation occurs in the dollar? Households will still have the same physical assets, they will just have an after inflation value of worth 20% more. And they still have the same amount of dollars. Those dollars will just buy 20% less.
3) I’m not buying printing $600 billion leads to a $10 trillion loss.
Paulson, Bernanke and Geithner. Line em up on the scaffold, I want to watch them dangle for the theft they are engaged in to MY wealth..........to OUR wealth.
We The People must demand an investigation into all three of these useful idiots.
It is an illegal, indirect tax on American households. Can anything be done about it?Court action?
Congress , can they do something like defund all salaries at the Fed?
Borders on? It is criminal. Mens rea and Actus Reus.
Video - Quantitative Easing Explained
http://www.youtube.com/watch?v=PTUY16CkS-k&feature=player_embedded
Excellent idea! Here it is.
http://www.federalreserve.gov/releases/h41/current/
The Fed is self funded, so no.
If politicians send SS recipients a check for $250, they might be better off not cashing it. The dollar will be worth that much less if they do, so they might end up poorer than before. Liberal “generosity” hurts everyone and hurts the recipients the most.
That’s why this will be terrible for the poor. They don’t have assets, just dwindling amounts of cash that will buy less and less.
But if the Fed will act to drain some of the liquidity once employment heats back up, then we shouldn't have much inflation. Instead the pumping will just offset the M3 fall.
Allowing the economy to run at 75% or get worse, is going to hurt the poor too. Because the government can't run these deficits forever. They have to get the economy going again so tax revenues are increased. Or government will have no choice but to cut the entitlements that the poor and unemployed are relying on.
I think this Fed move is a reasonable move given the high unemployment rates. Now if they would just
“I’m not buying printing $600 billion...”
Stop right there...I am not buying printing $600 billion. This is an asinine move that does hurt the 80% of us.
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