Deflation - making sure "IT" doesn't happen here

The FED's playbook for the coming years, this is kind of frightening...

As I have mentioned, some observers have concluded that when the central bank's policy rate falls to 0 percent, its practical minimum, monetary policy loses its ability to further stimulate aggregate demand and the economy. ... this conclusion is clearly mistaken ... a government should always be able to generate increased nominal spending and inflation, even when short-term nominal interest rate is ZERO.
The conclusion that deflation is always reversible under a fiat money system follows from basic economics reasoning. ... US dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many US dollars as it wishes at essentially no cost.
By increasing the number of US dollars in circualtion, or even by credibly threatening to do so, the US government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising prices in dollars of those goods and services.
We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.

Ben Bernanke from
Deflation - making sure "IT" doesn't happen here

Not elected, paycheck paid by the taxpayer, FED chairman until 2020, uses (at least) 200 billion of the taxpayers' money AND he has no clue

First Bear Stearns, then Fannie Mae and Freddie Mac, who is next? GM - Ford - AIG - Washington Mutual - the airlines - ...

Welcome to the U.S.S.A.: "United Socialist States of America".

52 days ago:
Fannie And Freddie Are Fine, Bernanke Says

Chairman Ben Bernanke of the Federal Reserve told Congress on Wednseday that he believes Fannie Mae and Freddie Mac will make it through the storm in the U.S. housing market.On Bernanke's second day before Congress, this time in front of Rep. Barney Frank's House Financial Services Committee, the Fed chairman said the troubled Fannie Mae and Freddie Mac were adequately capitalized, and were in no danger of failing.

This will add 5 trillion dollars in debt to the balance sheet of the USSA. Backed up by mortgages that are declining double digits per year...

The Bush Depression:

Mortgage delinquency and foreclosure rates hit records last quarter. And more prime borrowers are being affected. About 4 million U.S. homeowners -- including more than 65,000 Minnesotans -- were either behind in their mortgage payments or in foreclosure at the end of June, according to a second-quarter survey released Friday by the Mortgage Bankers Association.

That means that 9% of all homes are now in foreclosure or in default...

Incompetent

Bernanke, the son of a pharmacist, was raised in the hamlet of Dillon. Explaining the bookishness which saw him achieve the top SAT score in the state at high school - 1,590 out of 1,600, he said: "We lived in a small town that didn't have a movie theatre."

Harvard beckoned, where he graduated with the highest honours. A PhD followed at MIT, where he was diverted from research into the Great Depression by another story of ill-fortune: the ability of his team, the Boston Red Sox, to snatch defeat from the jaws of victory.

He has 1590/1600 for his SAT score but doesn't know basic economics...only in A...... That gives you some idea how "difficult" the SAT's really are.

October 2005: There's No Housing Bubble to Go Bust

February 14, 2008 "To date, the largest economic effects of the financial turmoil appear to have been on the housing market, which, as you know, has deteriorated significantly over the past two years or so."


And of course, he had something to do with it: "Bernanke was nominated by President Bush and is expected to win easy Senate confirmation next month."(2006)

Jim Rogers on the USD, Bernanke and China

This is Jim rogers so it is a must see if you are interested in anything to do with economics.