Posted on 05/12/2011 10:44:27 AM PDT by quesney
Federal Reserve chief Ben Bernanke reinforced his call on Thursday for Congress to raise the cap on U.S. borrowing, saying a failure to do so could lead down the same risky path that the failure of Lehman Brothers did.
During a Senate Banking Committeee hearing, Bernanke reiterated catastrophic consequences should Congress either fail to raise the limit on borrowing or edge too close to that limit.
"The worst outcome would be one in which the financial system would be again destabilized, which we saw in Lehman, which would have extremely dire consequences for the rest of the economy," Bernanke said, referring to the period following the failure of the Wall Street bank Lehman Brothers at the height of the financial crisis in 2008.
Bernanke also said that "using the debt limit as a bargaining chip is quite risky," reiterating a worry he expressed in a February press conference.
(Excerpt) Read more at finance.yahoo.com ...
well, ifn you can force yer boss [at gunpoint] to give you a raise to keep up the 'minimum monthly' why not ???
Quick, raise the limit on my credit cards so that I won’t lose my McMansion!
/s
McCain: Paulson, Bernanke Misled Me on Bank Bailout
McCain reportedly said Paulson and Bernanke initially assured him the $700 billion bailout would focus on the mortgage meltdown that spurred the financial crisis.
“Obviously, that didn’t happen,” McCain told the newspaper. “They decided to stabilize the Wall Street institutions, bail out (insurance giant) AIG, bail out Chrysler, bail out General Motors. . . . What they figured was that if they stabilized Wall Street - I guess it was trickle-down economics - that therefore Main Street would be fine.”
It has become apparent that Ben Bernanke’s economic forecasts are rarely ever correct...
Bernanke Scolds Congress/Keeps Bailouts Details Secret
April 16, 2010
Fed Chief Ben Bernanke told Congress to basically raise taxes and cut the federal budget. The inference was, if Congress doesn’t get its financial house in order, it will be their fault if the economy tanks.
Bernanke also said the federal debt “. . .is already expected to be greater than 70%” of Gross Domestic Product, “. . . at the end of 2012.” And if that is not bad enough, Bernanke said that by 2020, “. . .federal debt would balloon to more than 100% of GDP,” provided taxes are not raised and budgets are not cut.
http://www.jsmineset.com/2010/04/16/bernanke-scolds-congresskeeps-bailouts-details-secret/
Aug. 30, 2010
Federal Reserve chairman Ben Bernanke gave a speech claiming that the economy is finally headed on the right track. He stated at the Federal Reserve Bank of Kansas City’s annual economic symposium that “despite this recent slowing, however, it is reasonable to expect some pickup in growth in 2011 and in subsequent years.”
Here are just a few quotes showing Ben Bernanke’s oblivion to the looming housing crisis from 2005 to 2007:
July 2005: CNBC announcer Maria Bartiromo: We have so many economists coming on our air and saying oh this is a [housing] bubble and it’s going to burst and this is going to be a real issue for the economy. Some say it could even create a recession at some point. What is the worst case scenario?
Ben Bernanke: I guess I don’t buy your premise. It’s a pretty unlikely possibility… I don’t think it’s going to drive the economy too far from its full employment path though…I’m hopeful and I’m confident in fact that the bank regulators will pay close attention to the kind of loans that are being made and making sure underwriting is done right.
Ben Bernanke, February 2007: Our assessment is that there is not that much indication at this point that sublime mortgage issues have spread into the broader mortgage market which still seems to be healthy and the lending side of that still seems to be healthy.
Ben Bernanke, July 2007: Overall, the US economy appears likely to expand at a moderate pace over the second half of 2007 with growth then strengthening a bit in 2008 to a rate close to the economy’s underlying trend.
Despite Ben Bernanke declaring that the recession was very likely over in September 2009
******
US Fed lent $3.3tn to multinationals, billionaires and foreign banks
The global credit crunch of 2008 ran deeper and wider than previously disclosed, forcing the US government to fund firms including General Electric and Toyota, along with banks and billionaire investors, according to documents released by the Federal Reserve.
Under pressure from politicians, the US central bank has released details of 21,000 transactions it made as the global economy faced meltdown.
As well as its well-publicised support of the banking system, the Fed’s aid reached far beyond Wall Street, offering finance to the motorbike manufacturer Harley-Davidson, the industrial equipment maker Caterpillar, the telecoms company Verizon and even the computer billionaire Michael Dell as it struggled to keep the economy going. The lending reached $3.3tn (£2.1tn) at its peak.
http://www.guardian.co.uk/business/2010/dec/02/us-federal-reserve-bailouts-multinationals
“SSS” - Stop the Spending Stupid!!!!!
Every time I see Ben Bernake I wasn to Hisssssssss at him.
Why BOTHER to raise it? The Fed.gov has plans to AUTOMATICALLY exceed the limit this weekend through mechanized bond sales, so they are going to ignore the limit anyway, it seems.
“What’s the point of a limit if it’s always raised?”
GREAT point!!
And that Free Fed Money is what is keeping all financial markets/players alive right now.
And, all those players in the markets who are dependent on Free Fed Money need to fail ASAP to clear out the dead wood and allow a real recovery from whatever the bottom ends up being.
The Fed works for Wall Street.
If they are that shaky and close to collapse, then they need to fall and let some adults run the show for a while.................
Bernanke is on the DNC payroll. He is shouting FIRE in the theatre, when there is no fire. How to make interest payment on the debt without raising the debit ceiling? Simple, cut spending on less important, or wasteful, things. There are plenty of them.
“Poppa, give me another dollar!”
So a hypothetical question here: What would happen if the US renounced all debt owned by the FED but not other? - since they’ve been buying up bonds by the truck load and we wouldn’t be defaulting against anyone else.... Would a financial black hole open up or would we be able to then lessen the financial burden the nation currently has and implement a recovery without the fed and just the Treasury running the show...with banks dealing on their own with things as they did prior to the fed?
How is this any different from repeatedly maxing out a credit card and then calling the card company and asking for a raised limit? (Aside from the fact that, in our government’s situation, the spender is the same one deciding whether to approave the “raise the limit” request)
We are merely here to pay for the fiasco in painful ways once the game comes to a crashing end.
What a country.
Agreed. 3 trillion dollars and our economy is barely moving. We should had suffered the worst of it and allowed all the big banks and Fannie Mae and Sally Mae to fail.
It's not really a "limit", it's an authorization. The government is authorized to borrow a certain amount of money. They keep using it up so more has to be authorized.
Instead of raising the debt ceiling, how about cutting spending? Fiscal responsibility would be a good thing to show the people...
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.