Bernanke was a Bush Cheney puppet. Why is he still on?

So now we know what it takes to make these people want to do something positive: Threaten their power.

Because there isn’t a helluva a lot of difference between Obama and Bush.

“…China’s breaking the rules on currency manipulation.”
_________________

What are those rules, by the way? Where do I get a copy? And what happens if they break them? Is there a “penalty box” where errant Chinese money manipulators get to spend a time-out? And, by selling us stuff cheap, aren’t the Chinese actually penalizing their own population? If Bernanke is such a mis-guided bozo, what makes you think that the Chinese running their country’s monetary system are such mental giants? Why are foreigners always so intelligent and Americans so dumb?

Becuz O is a Bush-Cheney puppet.

shots from hard-money Republicans desirous of stopping any growth-inducing monetary policy.

Afghan Taliban use IEDs. American Taliban use WSJ editorials.

OT for Margaret — you have messages on the Talking Heads thread. Some folks are trying to contact you.

At least the Chinese have an excuse. The need to create something like 20 million jobs/year (don’t hold me to the #s; I don’t remember them, but the ones I’m using illustrate the issue, even if they’re not accurate): 16 million leaving subsistence ag for industry, school leavers, and a third category I’ve forgotten.

So if their policy of export driven growth is misguided, which it is in the sense that they should be trying to raise domestic consumer demand as part of their job creation strategy, at least it’s worked to create the jobs they need for internal stability for a couple of decades. Can’t argue with that success.

Furthermore, because of their history of rebellions, esp the Taiping Rebellion, they are paranoid (prolly justifiably so) about internal instability. So, not taking chances on a different economic policy when the one they have has spurred job growth (and remember their leaders were all trained as engineers, not lawyers) and kept the population from unrest, does not seem unreasonable.

Contrast the Chinese economics record with that of the U.S. in the past 2 decades, with unemployment near a post-WWII high, and the income distribution more skewed toward the rich than ever.

Easy to make the case that Chinese macroeconomic policy is a lot smarter than that of the U.S., even if Chinese policy could be better.

Also, focus on currency values is a complete red herring. Currency values, esp those of a low-labor-cost country, work to change supply & demand with long lags & extract large costs during the transition, like raising the cost of Chinese imports to the U.S. which would further impoverish U.S. poor, who are prolly big purchasers of them.

The only purpose of U.S. PTBs focusing on the forex value of the yuan is to deflect attention from their own policies of enriching the rich.

Bush started Iraq and Afghanistan and appointed Bernanke. All working out about the same, eh?

Morning Firepups:

I realize that I’m a simpleton dim bulb on this, but I just can’t seem to get my mind around the idea of pushing around the country that continues to fund US debt. Maybe it’s the MAD suicide pact of, “If you don’t loan us money, we can’t buy the crap you manufacture.” The Chinese play the long game, however. I just keep hitting the wall on the whole deal…

Thanks, RetirininFive! (I retired at the end of August and I’m still getting used to it!)

Everyone, please pass the word along to Margaret if you see her. I won’t be around much until later today.

Margaret, go see my #50 on the Talking Heads thread.

Now, peace out. Lots to do today.

Hubris of empire. The U.S. pushes around every other country “because it can.”

Eventually that will end but the U.S. won’t figure it out until it is too late.

Note that many of the developing countries have been “forced” into irrational (from the POV of balanced world economic growth) policies by the IMF & WB. That is, the only reason for developing countries to be net savers (when they ‘should’ be net borrowers to fund rapid growth), i.e. accumulate large amounts of reserves, is so that they won’t be subject to the shock doctrine & then have no choice but to go begging to entities controlled by developed countries, esp the U.S.

So, in that sense, China, India, Brazil, OPEC, etc. are already thumbing their noses at the U.S., but the U.S. hasn’t figured it out yet.

I’m off. Be well.

Ah yes, the focusing effect of 900 million angry peasants…

Keeps the leadership focused on what’s important. Their own skins.

Not to pile on with the same response, but in addition to the article by Krugman linked above, his most recent blog post spells it out:

More and more, it’s becoming clear that progressives who had their hearts set on Obama were engaged in a huge act of self-delusion. Once you got past the soaring rhetoric you noticed, if you actually paid attention to what he said, that he largely accepted the conservative storyline, a view of the world, including a mythological history, that bears little resemblance to the facts.

However, 600 Billion in QE and the consequent devaluing of the dollar and the ZIRP program which enables carry trade severely affects BRIC.

Thumb away. Watch the flood of cheap (low interest) dollars flood your economy and than own so much of your rents payments putting you (BRIC) in rent thrall to the dollar holder for ever…

Thumb away renters, thumb away…

“Hubris of empire” sorta sums it up, alright. Thanks much.

Printing additional dollar$ (buying US bonds from the Treasury) cheapens the value of the dollar. The action of the FED (buying $600 billion in US treasury bonds) is the same game the Chinese are playing. US corporations are sitting on $2 trillion dollars that could be used to creat jobs and bring the unemployment rate down. Now that Obama has “caved in” to the Hawks in both parties(can you say Hillary) and the military industrial complex by extending the war in Afghanistan through 2014 and beyond, that $2 trillion will be spent, jobs will be created, unemployment will decline and he will be reelected in 2012. Ain’t America grand! Peace

It’s not as though we depend on the Chinese to lend us money. They could stop tomorrow, but they don’t want to, because buying our Treasuries is part of their strategy to keep their currency artificially lower, ours higher, to benefit their exports. That’s Bernanke’s argument in David’s post.

There is no shortage of people willing to purchase US Treasuries as long as they’re seen as the safest around. And as we’re seeing, the Fed can purchase them itself, in which case, the interest payments paid to the Fed are refunded to the Treasury; so, in effect, we pay the interest to ourselves. Remember that when deficit hysterics complain about how much we have to pay in interest on the debt; but they then complain when the Fed reduces this problem, because it’s “printing money.”

I suppose there`s a cloud in every silver lining. When the US consumer gets too poor to buy all that stuff from abroad (other than Ferrari’s and Porches for the you-know-whoms), the deficit will right itself. And we won’t have any excess domestic saving either. We just have to get income and output low enough to achieve these goals. I think we are on the way to getting there. I would say equilibrium will come in at 14 to 16 percent unemployment. Hey, it`s a solution to the deficit problem.

The FED is not “ourselves”. It is a privately held corporation run by the world’s largest bankers. Peace

1 billion Chinese waiting to consume whatever anybody produces and 300 million American’s with no money to spend on anything. You tell me where the bourgeoisie capitalists will be buying their next villa? Peace

You’re missing the point. Whether the Fed is Ourselves or a Martian Monopoly, it returns the interest payments it receives to Treasury — so in effect, Treasury pays the interest and then gets it back — which is what I meant by “paying to ourselves.”

Only after the skim does it return anything to the treasury. Who do you suppose gets all that interest on our debt? The Chinese? They get less than 5%. The private owners(bankers) of the FED skim off about 40% as a cost of doing business. Peace

US declares financial war on world – economist

Michael Hudson on Russian TV explaining the absurdity of what the United States is doing:

The United States is going to China and saying we want you to commit economic suicide just like Japan did…. We want you to revalue your currency, we want you to squeeze your companies… Will you please help us by going bankrupt for our benefit?

I’m really starting to think Obama was handfed to us by these same NEO—CONS to preserve their power at a time when the country would have never allowed 5 more minutes of a GOPig Rule!!I still think to this day that this country has been controlled by these Cons for the past 30 years!

Banksters borrow 100s of Billions from the Fed at 0%—–buy US Treasuries and Securities at 5%——-hold onto it for 3 months——Rinse and Repeat in Perpetuity!!!!
What they do in fact is sell American Debt back to the Taxpayer and laugh all the way to their Banks with 10s of Billions in PROFITS!!!

No doubt. NYT Editorial today on Deficit reduction. Wonder what Krugman and FDL will respond with.

Only 42% of registered voters participated in the last election. The ones who did not participate were “our people”; FDL people who have not yet identified themselves as such.

The “Tea Party” did it, why can’t we? It’s all about who can inspire the most voters. The game is wide open, and there is a vacuum out there that we can fill. The “FDL” party?

Does it bother any one that the dollar has lost 90 percent of it’s value since the FED was established. Even though I don’t agree with alot of what the Tea Party stand for if their political clout will generate more scrutiny of the FED and the disgusting banking practices out there I think they did their job.

The other reason why we need the FED is to be able to support a world empire. If you get rid of the fed most likely the government would have to think twice about gong to war.

The Bernanke is the only one with the ability to put juice into the American economy at this point. Everyone else is politicking and playing games.

Long live the Bernanke!

Thanks for this discussion, in particular the part pointing out that the Fed is not us. It would seem that kicking the can down the road is a lucrative business, and why not blame someone else for what you are doing? After all, we the people are in the chase car and the guy in front is madly throwing thumbtacks out the window, the more the merrier.

Peace to all.

A couple more good posts on this here:

http://www.zerohedge.com/article/bernanke-throws-hissyfit
http://www.washingtonsblog.com/2010/11/fed-is-working-against-its-stated-goals.html

I have no idea why Obama has left this guy in place other than to continue to kiss Wall St’s ass, give the crooks our money, and screw the rest of us.

“Ben Bernanke absorbed a couple weeks of shots from hard-money Republicans desirous of stopping any growth-inducing monetary policy”

If this policy was so growth-inducing, why didn’t it work the first time with Bush/Bernanke?…why did Obama then do the stimulus instead of doing more of this supposedly wonderful policy? If this is so growth-inducing, shouldn’t Zimbabwe be a member of the G20 by now?

Throwing loose money at the banks isn’t going to do a damn thing to raise employment or generate loan creation.

Know who Nicole Gelinas is ???

Read her book and Richard Koo’s, first, if you don’t quite catch the arguments.

Forcing the Fed to use regulation to clean up their books (crashing their stock prices, short term) and get back to loan-based banking — that’s the ticket.