Fed: No taper

CNBC ^ | September 18, 2013 | Jeff Cox

[Hojczyk]

An economy still stumbling toward recovery was not enough to sway the Federal Reserve, which defied market expectations Wednesday and said it will not begin pulling back on its monthly asset-purchasing program. Stocks surged on the news but bond yields were flat.

[DesertRhino]

Slightly wrong. You have to go back to around 2004 to find 30 dollar oil. More than a tripling of price in 10 years, despite supplies exploding everywhere, and everyone here will still tell you there’s no inflation.

[DesertRhino]

The Wall Street Journal, one hour ago.

“The Federal Open Market Committee, the Fed’s rate-setting group, decided to keep buying government and mortgage bonds at a monthly clip of $85 billion, defying market expectations of a reduction in asset purchases by $10 billion to $15 billion. The Fed cited risks to the recovery in the world’s largest economy from higher borrowing costs and lowered its growth forecasts for this year and the next.

The trillions of dollars spent by the Fed buying bonds since 2009 have not only calmed debt markets,,,”

[palmer]

They mean borrowing of course and these activities should always be called `borrowing' when the audience is ordinary people.

Technically it is borrowing, but actually it is just printing money and giving it to politicians to spend.

[TomasUSMC]

In 2009, the US national average price of a gallon of regular gasoline was $2.35

[edpc]

Hardly shocking. This admin is nothing but sleight of hand, smoke and mirrors, Potemkin Village....and many other metaphors. We shouldn’t be surprised they would be propped up by more fakery.

[TomasUSMC]

So money is printed out of thin air and WE THE PEOPLE have to pay it back? But if I print money, is that ok? Hey, I’ll pay it back, I promise, just let me print it up tomorrow.????????

[Toddsterpatriot]

So money is printed out of thin air and WE THE PEOPLE have to pay it back?

No.

When the Fed prints money and buys a bond why would you have to pay anything back?

[willywill]

“Slightly wrong. You have to go back to around 2004 to find 30 dollar oil. More than a tripling of price in 10 years, despite supplies exploding everywhere, and everyone here will still tell you there’s no inflation”

thank you. time flies when you get old

[willywill]

and you forget how to spell also

[jdsteel]

“Most Pittsburghers are socially pretty conservative and would have seen eye-to-eye with Reagan.”

True, but most old-school Democrats would vote for the Devil himself before pulling that “R” in the voter booth...Reagan was the exception because they saw what “Reaganomics” brought.

The new Pittsburghers are of the hard core lefty, pseudo-intellectual Marxist types. Yuck.

[fortheDeclaration]

The economy was never going to turn around with massive government spending, it never has and never will.

What turns an economy around is massive savings that produce investment.

So, it does matter if Bernake is a disciple of Keynes, but at least Keynes advocated tax cuts in a recession, we are about to be hit with a massive tax increase with Obamacare.

[exDemMom]

The Fed said it was unsatisfied with the pace of economic growth and felt the timing was not right to make a change in quantitative easing.

This is unreal. Economic growth is crippled by all the debt, and the fed's answer is to continue growing all the debt?!?

As Rush pointed out yesterday, this is feeding into a huge stock market bubble. When that bubble pops, it is going to hurt.

[TomasUSMC]

So the money is printed and never has to be paid back? By anyone? Hell that does sound like a great idea. Why not print 16 trillion a month and pay off the National Debt in 30 days?

Isn’t the USA just taking out a loan of 85 billion every month from its own imaginary printing press? And if that loan isn’t paid back in real money.....it just dilutes the buying power of our money by a trillion dollars a year?

okay, I’m glad we the people don’t have to pay back these 85 billion a month. Just wish they’d print a few billion more of it and send it directly off to the working man....why not...they just printed it out of thin air?

Here is a question...how much does each 100 billion in QE increase inflation? Is there a calculator out there for that?

Thanks for your continued efforts to make these damn thing easier to understand.

[Toddsterpatriot]

So the money is printed and never has to be paid back?

It's not borrowed, so where would you pay it back?

Isn’t the USA just taking out a loan of 85 billion every month from its own imaginary printing press?

The government is over-borrowing and over-spending, whether the Fed buys any bonds or not.

And if that loan isn’t paid back in real money.....

If the government defaults on their loans, we're in trouble.

okay, I’m glad we the people don’t have to pay back these 85 billion a month.

But we do have to pay back the hundreds of billions that Obama will waste this year.

Here is a question...how much does each 100 billion in QE increase inflation?

No one knows.

[OneWingedShark]

>> In short, the Fed is basically a legalized counterfeiting operation. They can create as much money as they like for free > > If it's legal, it's not counterfeiting. And of course central banks can create money for free. Ah, but is it legal? Despite what the courts say, there is an interesting clause in the Constitution about gold and silver being the only monies that states can make usable for debts (No State shall […] coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts;) — and if the Constitution stipulates this, then the States paying the FedGov in anything other than Gold or Silver would be endorsing an illegal form of tender, no?

[Toddsterpatriot]

And of course central banks can create money for free.

Ah, but is it legal?

Yes, it's legal for Central Banks to create money.

Despite what the courts say, there is an interesting clause in the Constitution about gold and silver being the only monies that states can make usable for debts (“No State shall […] coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts;”)

You're right, if a state created a central bank and didn't use gold or silver, they'd be in trouble.

then the States paying the FedGov in anything other than Gold or Silver would be endorsing an illegal form of tender, no?

No.