The politics of Fed policy

Cross-posted from Credit Writedowns

Federal Reserve Chairman Ben Bernanke is due to speak before Congress. Let me say a few words about what’s going to happen with the Fed.

Here’s the thing: The Federal Reserve Board is located in Washington, DC and Washington is a political town. As such, the Fed must mind its manners or it will find its mandate diminished…

the issue here is the politics of the matter. The Fed has already spent its political capital. And if you want a reason why the Fed isn’t doing anything about the renewed economic weakness despite Bernanke’s famous 2002 helicopter speech, this is it. The Fed knows darn well it has spent its political capital…

The reason the Fed isn’t doing anything is because they are saying in effect "central bankers alone can’t solve the world’s economic problems." The subtext being they feel politically constrained and will not act until they get political consensus that they should do so. Moreover, when you have Fed governors like Charles Plosser or Thomas Hoenig saying something different, it makes it difficult politically to go all in. So you wait.

The Federal Reserve Wants Inflation

Let me restate this: actually, David Beckworth and Scott Sumner are right; what the Fed really wants is higher nominal GDP. Now I wrote the paragraphs above in October of 2010, knowing that the Fed “may well have already begun some QE type stuff.” But my analysis said that QE2 would be small potatoes – what I call QE-lite – and that the aim would be boosting asset prices.

In retrospect this is exactly right; the Fed did not do rate easing or credit easing or ‘municipal easing’ (buying munis). And the Fed played up the asset market impact of its quantitative easing and played down the interest rate impact.

But what about inflation? Well, commodity prices rose during QE2 but that was not a positive happenstance for the Fed. So that tells you what the Fed want is higher nominal GDP, preferably from real growth rather than inflation. And we’re not getting that, nor could QE2 deliver that.

With Bernanke on deck, I think Mohamed El-Erian’s view on the politics of Fed monetary policy in in line with mine.

I say:

“Because the Federal Reserve has become a political target, it is in no hurry to have monetary policy displace fiscal policy in underpinning the economy, but it may be forced to do so given its dual mandate and the likelihood of fiscal contraction…

I do not expect QE3 now nor do I expect it unless the economy deteriorates further.”

El-Erian says:

“We would assign a low probability (at) this stage to QE3 given the general recognition that the forward-looking cost-benefit analysis has shifted away from the potential benefits and towards greater costs and risk…Therefore, it would take a major further deterioration in the economic outlook, combined with a willingness by the Fed to take greater reputational and political risks”

The FOMC is divided now. Tim Duy gets at the internal politics:

The discussion of the economic situation was markedly downbeat, even before the latest employment report, yet the final outcome of the meeting – the FOMC statement and Federal Reserve Chairman Ben Bernanke’s subsequent press conference – seemed to clearly indicate that, barring an outright return to the threat of deflation, the Fed saw its job as done. How can we reconcile these two positions?  Presumably the faction leaning more toward additional easing is relatively small, while the majority believes either they have already gone too far or that further policy is ineffectual.  Bernanke seemed to place himself in the latter category during the press conference.  Is that really where he stands?  This apparent divergence of views on the FOMC will bring extra attention to Bernanke’s testimony today on Capitol Hill.

So there you have it. The Fed could do a number of things: rate easing, municipal easing, inflation targeting, nominal GDP targeting – not that these things will be super effective in a balance sheet recession because even creditors shift to capital preservation when the likely outcome for the next decade is one of sub-par global growth with short business cycles punctuated by fits of recession. (see here). But, still, the impotence of monetary policy doesn’t mean these things will have zero effect. If the Fed really jammed it on, the economy would most definitely respond. It is just that “the forward-looking cost-benefit analysis has shifted away from the potential benefits and towards greater costs and risk” of more monetary stimulus just as El-Erian has said. Unfortunately with fiscal policy also tightening, that spells economic weakness.

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About Edward Harrison

I am a banking and finance specialist at the economic consultancy Global Macro Advisors. Previously, I worked at Deutsche Bank, Bain, the Corporate Executive Board and Yahoo. I have a BA in Economics from Dartmouth College and an MBA in Finance from Columbia University. As to ideology, I would call myself a libertarian realist - believer in the primacy of markets over a statist approach. However, I am no ideologue who believes that markets can solve all problems. Having lived in a lot of different places, I tend to take a global approach to economics and politics. I started my career as a diplomat in the foreign service and speak German, Dutch, Swedish, Spanish and French as well as English and can read a number of other European languages. I enjoy a good debate on these issues and I hope you enjoy my blogs. Please do sign up for the Email and RSS feeds on my blog pages. Cheers. Edward


    1. Just Tired

      B.S. Bernanke sure made you look good this morning. As far as the author of this post, Roseanne Rosanndanna comes to mind — “Never mind”.

  1. ep3

    I have said this before regarding people like Greenspan who say “the president isn’t doing enough fiscal stimulus”. These people that “go against the grain” and say things that us smart people want to hear, I think they are actually doing it for political reasons. What they do is undermine any political capitol the Fed or Obama may have so that their words diffuse the rallying cries for more action. Obama for example hears in one ear “the stimulus failed” by his teams. Then he hears from the ‘godfather’ of failed policies that more stimulus is needed. This results in confusion AND political inaction.
    “what do we do? this guy says this, this guy says that”. The dog chases his tail until he gets dizzy and falls down and gets absolutely nowhere.

  2. MyLessThanPrimeBeef

    He mentioned something about ‘untested means.’

    I guess we are the guinea pigs.

    Wonder if Murdoch hacked into his accounts?

    Maybe he’s confusing us little economic role-players with his depression and he thinks untested drugs are called for in this case.

    1. Cedric Regula

      Corporate profits are back to pre-crisis bubble levels. So I don’t know what Ben thinks he needs to stimulate. Hedge funds? Commodity prices? OPEC? His scalp?

      1. Cedric Regula

        Oh wait, I know. China needs stimulating. I read about a slowdown there. There’s that global coupling thingy.

      2. MyLessThanPrimeBeef

        How high will gas prices go this time?

        I might end up regretting not get that new Nissan Leaf.

        1. Cedric Regula

          When they’re falling, it’s the GS target price plus a buck. When they’re rising, it’s the GS target price minus a buck.

      3. Sayer

        Yeah, his scalp. No “green shoots” that I can see. (Mind you, my TV’s a little blurry.)

  3. KnotRP

    None of this is going to reverse globalization’s affect on US lifestyles….it’s deck chair rearrangement on the Hindenburg.
    Move. Move. Move. Does someone smell smoke? Move. Move. Move. Is it hot in here? Move.

  4. Paul Tioxon

    The state without taxes is like a business without profits, what’s the point? The guns of the state are supposed to be in partnership with the gold of the merchants, but now, there is a breach of the social contract which lets money into the private sector in an unlimited fashion while the state is demonized as a beast to be starved. A house divided against itself can not stand, not with the load bearing walls being torn out day after day with more and more tax cuts, loopholes and give aways. I do not expect the People’s Army of China to lay down their precious blood and treasury for Goldman Sachs anytime soon, so just what is the internal battle to the death being waged before our eyes in DC all about. Clearly, the Fed can not do alone what must established as a political order from the politicians. And the politicians can not agree on just what it is they do anymore.

    1. KnotRP

      > And the politicians can not agree on just what it is they do anymore.

      Politicians divide up the American pie and feed it to
      their constituents.

      They are still stumped about the lack of American
      pie, but they are not going to starve by golly…they will continue
      to import more and more pie until the American pie
      making recovers, which should happen in H2. :snark:
      They are pretty sure American pie makers just need
      more confidence, or education, or a loan, or something.

      1. KnotRP

        We’ll have to keep printing money for more pie buying,
        to encourage pie making. :snark:

        And we must raise the pie buying ceiling,
        since it would be a catastrophe if we couldn’t
        buy more pies.

    2. Sufferin' Succotash

      “the politicians can not agree on just what it is they do anymore”

      All the more reason to carry on an endless distracting debate over something as senseless as the debt ceiling.
      Talk about rearranging deck chairs. This is more like rearranging place settings.

    3. Cedric Regula

      When US corporations say they can’t find experienced workers and their exacting skill set, and this is limiting growth, all the politicians agree we need more H1-B visas.

      In fact, they fixed the 2000-2002 recession by keeping the H1-B quota at Y2K + levels all the way thru 2003 to make sure the recession ended.

      So once and a while we hit the sweet spot, in between long bouts of gridlock.

  5. rps

    they are saying in effect “central bankers alone can’t solve the world’s economic problems.”

    Truth is the central banker boys Won’t solve the world’s economic problems They created. life is good for them with territorial division of the sandbox each owning a sandcastle. These latchkey banker boys desperately need parental supervision

    Things to do list:
    Reinstate Glass-Steagall Act
    Regulation of Derivatives, zero gambling of life-necessities–commodities
    Return to Fair trade, not free trade
    It’s Jobs Stupid. Maximum paying jobs are what makes the dollars go round

    1. Cedric Regula

      People always like quoting Albert Einstien in these cases. “The definition of insanity is doing the same thing over and over again and expecting a different result.”

      So I propose renaming the Fed building:

      Albert Einstein’s Nuthouse For The Terminally Crazy.

      1. Cedric Regula

        But anyway, I hope my comments aren’t making my bubbly, over-the-top-giddy, enthusiam for monetary policy and politicians too obvious.

        1. Valissa

          “Infinity is just a number”
          Federal Reserve Institute, Department of Mathematics

          “Faith can be valued objectively”
          Federal Reserve Institute, Department of Finance

          “According to the latest government regulation; Goodwill can be ‘printed’…”
          Federal Reserve Institute, Department of Accounting

          “Revolution? Well… that’s why we need the gun control.”
          Federal Reserve Institute, Department of Political Science

          “Run for your lives!”
          Federal Reserve Institute, Department of Physical Education

          1. MyLessThanPrimeBeef

            “How A Naked Fed Finally Stimulates!” – The Federal Reserve, Department of Research on Magic

          2. Valissa

            MyLTPB… ahem… don’t you mean Department of Alchemy?

            On second thought, the goal of alchemists was gold… hmmm… Dept of Magic isn’t quite elite enough sounding…. how about Dept of Thaumaturgy OR Dept of Legerdemain

          3. MyLessThanPrimeBeef

            The more elite Department of Alchemy is reserved for ‘Because We Were Created Out Of Thin Air, We Can Create Money Out Of Thin Air.

          4. Cedric Regula

            They do have a crew polishing the gold at Ft. Knox.

            Never know when you might want to mint the stuff, ya know.

  6. Le Cut Paste

    What are the people of Germany doing? Sleeping. Their sleep is filled with nightmares and anxiety, but they are sleeping. We have awaited their awakening for so long, yet they continue to remain stolid, stubborn, and silent as to the crimes committed in their names, as if the entire world and its own destiny had become alien to them. All agree: the German people slumber on amid the twilight of their gods. They do not love liberty, because they hate criticism. That is why they are sleeping today.

    Albert Camus, September 17, 1944

    1. craazyman

      where is that quote from? essay or letter?

      AC was the only 20th century philosopher who had something relevant to say. IMHO.

      1. ambrit

        Dear craazyman;
        I beg to differ. I like Malraux because he lived the struggle, and soldiered on. A ’30s Comintern man who also worked in DeGaulles Cabinet? What’s not to like?

  7. Susan the other

    This is a world population story. The world population is peaking. Population growth is over. Population levels will gradually decline now to a more “sustainable” level. This is a good thing. But what it means to a die-hard capitalist economy that was accustomed to easy pickins is that the economy must also shrink.

    Beginning now, we are faced with long term deflation.( Bernanke knows this, but Ron Paul hasn’t caught it yet.) Maybe a century of decline. In just one century there are approximately 3 to 4 generations. If each generation produces fewer offspring and thereby lowers the population by a ratio of two parents down to two or less children we could see a population of 4bn by 2099. Assuming that all of us old farts graciously die off. I can definitely assure you that I do not want to live to be a thousand. A thousand more years of mental torture? That would not be a good thing for my happiness.

    So of course Bernanke wants a little inflation. Who didn’t? Pretty soon it will no longer be referred to as quantitative easing. It will just be. The Fed should go ahead and toss a line to muni bonds. As in your previous article. That is a good thing.

    It’s pretty annoying how the Fed has condoned all the big bank fraud, blatant securitization fraud and lots of other stuff, and has given them the life line they need to continue to function, often improperly. That’s the part that really bothers me.

    But even tho’ Ron Paul is still dithering about the definition of money, money is nothing more than an agreement to pay. “So is gold money?” Ron Paul asks Bernanke. And Bernanke says” No. Gold is an asset.” And then Ron Paul loses his train of thought because he did not anticipate the answer. The fact is, gold is nothing more than a pretty shiney metal. It is a commodity.

    Even Mitch McConnel has a clue about money. He just abdicated the purse! Wow. That was unexpected. He doesn’t want to have anything more to do with this whole debt and money thing. How amusing.

    So who cares anyway. I don’t. Let’s print up the money and spend it wisely and get on with it.

    1. MyLessThanPrimeBeef

      This comes as no comfort to me, but I fear it will ultimately take the Supreme Court to decide on the definition of money.

      It’s hard to describe it. You know it’s money when you see it.

      (Lots of people laugh at their definition of another salacious case, but in a way, it’s very Zen.)

      For me, gold is money. I know of a few places where I can get food for my gold. So, voodoo shaman in chief is wrong, again…well, for me, anyway.

      1. Cedric Regula

        I’ve decided money is something you should learn about in the privacy of your own home, and just not tell anyone about it.

    2. craazyman

      All quite true. Funny how everybody thinks the world population is booming but I think you are correct, maam. People should get richer and richer as long as the economy falls more slowly than population.

      OK, your turn to be Fed Chairperson.

      Speaking personally, I wouldn’t want the job. No way could I sit through one of those congressional testimonies without a big hit of Xanax and about 4 shots of Jack.

      I think it would be embarrasing. The videos of it. Not sure how the Bernank does it, really, I don’t. Wonder if he’s a Xanax guy or whether he just takes it cold sober. Maybe he actually enjoys it. That’s a weird thing to contemplate.

      1. Cedric Regula

        I wonder about that too.

        Whatever Greenspan took, it made him talk weird and gave him wrinkles.

      2. Just Tired

        “Speaking personally, I wouldn’t want the job. No way could I sit through one of those congressional testimonies without a big hit of Xanax and about 4 shots of Jack.”

        Judging by what comes of the meetings, you would be one of the few lucid people in the room.

  8. rps

    Prior to Prom, high schools have mandatory video viewing for the prom attendees of drunk driving and the life-altering after-effects due to willful negligence. A similar policy should be mandated for the Federal Reserve Board; video-watching of their previous willful negligence and negative life-changing policies upon the well-being of societies. Plus a viewing of Cambridge Professor Ha-Joon Chang; Economics Upside Down who discusses some ideas that seem contrary to traditional thinking in economics, such as free trade does not necessarily make countries richer, and that there is no such thing as a free market.

    “Men who look upon themselves born to reign, and others to obey, soon grow insolent. Selected from the rest of mankind, their minds are early poisoned by importance;…” T Paine

  9. John Emerson

    As I understand, when the Fed had political capital it diligently did harm, but now that it doesn’t, it’s not going to try to repair the harm. Not surprising at all, but it does help keep my rage level up at 11.

  10. Hugh

    The Fed is a major enabler of kleptocratic looting. QE2 was mostly a cover that allowed increased speculation in commodities. The rubes started to get restless, and the Fed decided to back off for a while. That’s about all that has happened here.

  11. Tom g

    These type of threads describing the Fed as some sort of political entity always crack me up. Do you really believe Bernanke is walking on eggshells because he is located in DC?

    He knows that his job is to maximize the profits of the largest financial institutions (note:systemic importance is irrelevant, Tishman Speyer 4.5 cap boners in Maiden Lane?! give me a break).

    This is why he was able to expand his balance sheet by trillions of dollars before he had breakfast in the morning. Absolutely nothing political about that. Bada bing, done. You want to talk politics go to the circus (congress) and observe it.

    1. Just Tired

      You forgot one of the families. It is not well known but the ninth family is headed up by Big Tony Ski who really holds sway over the other eight lieutenants that make up the Corte di tutti corti. Like Yogi Berra said: “You could look it up”.

  12. juno

    There will be QE3; Bernanke was fairly direct on this today but anyone following the Labor, Commerce, Treasury and a hand full of other economic indicators.. certainly cannot be surprised by this development. Traders have known for months!

    An aside; El Arian is hopelessly compromised by PIMCO, as is Gross and the Burt (as in Burt and Ernie) look-alike..Kashkari.

    Jobs, jobs, jobs is the only answer! To paraphrase…even if the gov’t has to pay people to dig a hole and fill it back in…we need jobs! There can be no recovery..economic, housing or otherwise in a consumer-led economy… without jobs. Anyone that believes otherwise has it bass-akwards.

  13. scraping_by

    QE is handing large amounts of money to those already holding large amounts of money. Fiscal policy is applying money to real world problems, a real world composed of very few rich people. It’s not hard to see which is more palatable to the lackeys of the elite.

    Mr. Harrison’s conclusion about the next Fed steps are based in reality. Throw in the anti-union fanatacism of the Right and keep in the wings the anti-poor slur that Reagan always kept to hand, note that Obama is insecure about being out-grovelled by the GOP he’s going to kick granma to the curb, and the jobs exporting treaties… All in all, the only way to get money these days is to steal it, and the rich are doing that with abandon.

  14. Crazy Horse

    One or two of you asked me to elaborate on parts of this rant posted to an earlier topic. Since it is relevant to the current discussion I’ll re-post an expanded version.
    Crazy Horse says:
    July 13, 2011 at 12:19 am

    Amazing how the mention of the word “money” pushes all the irrational buttons in the modern psyche. Let me point out a few obvious facts:

    Gold is an essentially worthless metal, good only for pounding into shiny trinkets because it is so soft. The fact that humans have assigned great value to it for a brief portion of their history as a species doesn’t alter the fact of its use value. If you insisted that I exchange a 100# bar of the stuff for a good horse 250 years ago you’d likely get a haircut, and not the kind that banksters are trying to avoid in 2011.

    I live in one of the few places left where I can supply my family with a year’s supply of meat with three or four bullets. Once commerce grinds to a halt, try to do that with a 100# bar of shiny metal. And I damn well won’t trade my bullets for your gold.

    Paper currency actually has more use value than gold: at least you can use it to start a fire and roast your venison.

    Currencies, whether they consist of shiny metal, paper, or giant stone discs only have value to the extent that people accept them in exchange for something that they want or need. Gold only differs from paper money in its inherent scarcity and longer history of illusory assigned value. The US dollar or the Euro can become the Argentinean Peso, or the Reichmark of the future under the right circumstances, and those events are no longer unthinkable.

    Which brings us from the past and possible future to the present fractional reserve banking system. The most basic fact that few people seem to be able to grasp is this: In a fractional reserve banking system, MONEY does not exist until it is lent into existence. Until that point it is merely an accounting notation in the central bank’s ledgers. When a retail bank makes the decision to lend money to build a house, fund business operations, or loan money to a drug cartel, the central bank credits the retail bank’s account to fund the loan and the money enters the money supply (i.e. becomes MONEY in circulation rather than virtual money) paying the salaries of carpenters, office workers, or the guy selling nickel bags on the corner. Loans are not made because the retail bank has accumulated deposits as myth would have it: they are made because the bank has located a willing, “qualified” borrower. The Treasury can print all the paper and coins it wants, but short of dropping them from a helicopter or adding people to the federal payroll, in a fractional reserve banking system the currency doesn’t enter the money supply until it is loaned out. As the newly created MONEY circulates through the real economy it creates additional jobs and economic activity. That was called the multiplier effect back in Econ 101. It could also be called debt slavery with complete accuracy.

    Interest is not the “free market” cost of money, but rather the price of allowing banks to administer the system, construct fancy buildings, gamble in the derivatives market, and pay their executives multi-million dollar bonuses. It also is the mechanism by which the FED tries (ineffectively) to manage the economy and control the rate of inflation/deflation through the discount rate.

    Unfortunately Bernanke, Geitner, Obama, and the howling pack of crazies that populate the Republican Party could care less about stimulating activity in the real economy as long as their benefactors can receive huge executive bonuses and fund their re-election campaigns. Why else would politicians pour trillions into the pockets of their bankster overlords, enabling them to continue to sit at the world financial system casino tables? They can’t be dumb enough to not know where the money goes and how little stimulus effect QE2 and the Bush Billionaire tax cuts really have.

    The clamor for austerity turns rational policy exactly on its head unless the goal is for Europe and the US to become the new third world and undercut Chinese wage rates.

    Rational policy would do just the opposite of austerity: Eliminate fraudulent asset valuation on bank books, nationalize the bankrupt institutions, return to progressive income tax levels of the 1950′s and distribute the nation’s wealth in a fair manner, institute a national single payer medical system, eliminate predatory private health insurance companies, change prescription drug research and development to funding through universities and research institutes and abort the big Pharma drug pushers, legalize all recreational drugs, put the cartels and the CIA out of the street drug business and clean out the prisons, and last and most important, change the Department of War to the Department of Defense by closing all overseas bases and cutting the Pentagon budget in half initially and then halve it once again. We need employment and a 21st century infrastructure, not austerity.

    Revenue shortage? Hardly. There is plenty of money in the richest country on earth to put people back to work and begin preparing the country for the next century. The money not spent lining the pockets of the bankster and military cabal could fund a 6 million man/woman WPA to build the energy and transportation systems of the future (like China is starting to do), provide free education like Cuba does instead of saddling college graduates with debt slavery, wean ourselves away from unsustainable petroleum based agriculture, rehab our housing stock to cut energy use in half,—– there is no shortage of things we could be doing if we had a vision of the future and the collective will to seize political power back from the ruling class that has stolen it and American democracy from the people.

    1. MyLessThanPrimeBeef

      This may sound crazy, but I like to see all taxes collected, from both corporations and individuals, be divided equally and refunded back to all non-corporate taxpayers.

      At the end of each tax year, each of us gets a check from Uncle Sam.

      As for money needed to run the government, all taxpayers, both corporate and individual, each gets a bill with a detailed breakdown, like, for example (remember, these not real life numbers):

      Your share of overseas military bases: $2,503.32

      Your share of nation building in Iraq: $12,531.21

      Your share of toilet seats needed by the Pentagon: $253.15

      Your share of internet dating for gov’t officials: $839.12.

      Your share of interest payments to banktser: $3,501.20


      1. MyLessThanPrimeBeef

        I don’t think you need coffee to stay awake after receiving a bill like this.

        1. Cedric Regula

          Remember that “toilet seats” is a synonym for “Men In Black” budget.

          And “nation building in Iraq” could mean almost anything. I think Ron Paul wants to audit that too, now that Orszag left for Citigroup and has to start all over again there.

          Then I was wondering…do you think they will tax us for the “off budget” stuff? Doesn’t seem fair :(

          1. MyLessThanPrimeBeef

            I believe if you would take time to compare the charge for ‘peace and security’ on your bill to one a Swiss might get, a lot of people might start thinking we should be a country of cuckoo-clock makers.

      2. MyLessThanPrimeBeef

        I should add that there are 2 goals with this plan.

        The tax refund part, the first part, is for wealth distribution, when combined with a progressive tax scheme.

        The second part, the annual bill, is to make it easier to understand what we are getting for the products/services we are being charged. If you ever stayed at a hotel, you would know what I am talking about.

    2. rps

      I would like to attach an addendum to Tashunca-Uitco’s comment
      1. All utilities (water, energy, banks, that are necessities of the commonwealth’s survival) must be public-owned and never privately contracted
      2. Private enterprises, industries, etc…..profiteering must be tightly regulated with a maximum percentage ceiling.

      1. MyLessThanPrimeBeef

        I wonder if it would be more effective to have 4 co-presidents, like the Romans did at one time.

    3. MyLessThanPrimeBeef

      I also find these trinkets essentially worthless like gold when commerce grinds to a halt and you need to barter for food:




      music CDs

      movie DVDs





      paper money

      among many other things.

      Although I think a kilo bar of gold might be useful in knocking unconscious a chicken before you cook it or some unwanted intruder loitering around your cave.

      1. MyLessThanPrimeBeef

        But you might be able to barter bullets or tanks for food if your neighbor just happens to need some bullets for his gun.

        I suppose one can make a case for using bullets as money.

  15. TC

    All head fake. Neither the Fed’s extraordinary easing nor its present restraint repairs shattered confidence in the once, one-and-only game in town — a fee-based, leveraged Ponzi scheme — whose collapse only is being hastened with QE. A contracted physical economy now is supposed to support an even bigger mountain of debt? All that money for an Ivy League education!

  16. bob

    “the Fed must mind its manners or it will find its mandate diminished”

    I get what you are trying to say, but this isn’t the way to say it.

    The fed never has had to “mind it’s manners”. It just has to come up with long strings of words most people don’t understand to explain it’s past bad behavior, and why it may be necessary to repeat said bad behavior in the future.

    The fed is first and foremost a bank. The mandate attached to being a bank trumps all other political or legal “mandates”.

    They fart in your general direction.

  17. Hal Roberts

    Until the power that be in the USA get back to a basic economic structure the world will suffer. Why Trickle Down will not work to many key factors(Consumers=employees) cogs if you will are not getting greased (money)so small business suffers, then their suppliers suffer, then manufactures suffer. Should the economy get stimulus in these extreme times yes but when you give it to the top manufacturers they look at the economic environment and say the Consumer is not spending money so they stash the money in some kind of account and you end up with a big strong manufacture that looks good on paper and looks like they are a good investment and some body puts money in the Co. the DOW may go up but the stimulus to Main St. is practically nil. So much for dead end Trickle Down.

    We need to start some infrastructure rebuilding bridges, road etc.. this will put money in to the most important key factor of business the Consumer who will spend the money on Main St. this in it self will not complete the task it is only a temporary stimulus so we need to accompany this action with a new business sector and a new Commodity. Cannabis is a solid answer to our problem. People who say they
    have a Moral problem with this are beyond help alcohol is a far more dangers drug than cannabis ever could be. End Socialist America and let Capitalism rule again. Stop Defacing the Dollar with dead end QE Trickle Down will not work. We already have a welfare standard and bankruptcy proceedings.

    I got Visine, spend that money. Low tech economics. Trickle Up.??

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