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Friday, November 19, 2010

Counting the Lies...

Ben Bernanke doesn't seem to be too pleased that he has critics who are vocal against the additional $600billion in free money called Quantitative Easing the Fed gave to the banks under the guise of 'stimulus'.

So in an AP article entitled "Bernanke Hits Back At Critics of Bond-Buying Plan-- defends Fed's bond purchase plan but warns Congress must also back more stimulus aid", he tries to justify his actions with lies..  Let's count them, shall we

**  All lies will be in Red

From AP: "Federal Reserve Chairman Ben Bernanke has sought to defuse criticism of the Fed's $600 billion bond-purchase plan by arguing that it's needed to boost the economy and reduce unemployment. But he warned that the Fed's program can't succeed on its own."

~ Two lies in once sentence- the $600 billion will do neither.  It will give free money to the banks to supposedly lend but which they will not do.  Instead, they will take that free money and buy US Treasuries at 3% interest.  The $$ never goes into the private sector.

"In his first speech since the Fed announced the program Nov. 3, Bernanke on Friday made his most forceful case to date that Congress also must provide more stimulus aid. Without more stimulus, high unemployment could persist for years, he said. But in making that argument, Bernanke risks heightening complaints that he's plunging the Fed into partisan politics."

~ Lie #3- High unemployment will persist for years because most US manufacturing jobs are now overseas and businesses have no incentive to hire unless its for lower wages, fewer benefits and zero job security.

"He also said the global economy could falter if struggling countries abroad don't receive sufficient support."

~ Lie #4- The global economies will falter no matter what because in the past 2-3 years, nothing has been implemented to correct the problems which caused the financial meltdown we're still feeling the affects from... Bernanke is talking about continual bailouts in a very large scale of most if not all major banks around the world.  That is what he means by 'support'-  this money comes from taxpayers which in eventuality, brings upon austerity, dramatic cuts in social programs and a deeper discrepancy between the haves vs have-nots

"The Fed's Treasury bond-buying program is intended to invigorate the economy in part by lowering interest rates, lifting stock prices and encouraging more spending. Lower interest rates on loans would prompt companies to borrow and expand. And higher stock prices would boost the wealth and confidence of individuals and businesses, Bernanke has suggested. The additional spending would lift incomes, profits and growth."

~ Lies, Lies, Lies..  I lost count after that paragraph-  all ideological hogwash.  As I've written repeatedly here, Bernanke wants to devalue the US dollar so it is virtually worthless in order to attract foreign exports and compete with the devalued Chinese currency.  The more money you print, the less value the paper has that's being printed.  The interest rates are already at near zero- been this way for over a year.  Still no job growth.  Adding $600billion to public debt can't lower interest rates any lower than they are and won't make any real difference in job creation.

Please understand what this is-- it's chicken/egg:  companies won't borrow, expand or hire until there's tangible signs of economic growth particularly in the US consumer.  The consumer can't match pre-recession levels of consumption due to massive debt loads carried and massive unemployment among the American people.  You can't spend if you have no money.. can't make money if there's no job.  Can't get work if companies refuse to hire.  And companies refuse until consumption picks up.   Its a cycle.

Many people say that job creation comes from the private sector- but the truth is this- if a business can get by with a staff of employees who are mostly temps and easily discardable, what is their incentive to expand to hiring full-timers who receive good wages and benefits? 

Lastly as I've stated repeatedly in this blog, the market does not represent the true economy.  For most of US history, the market would be an accurate barometer of the economic state of the nation.  Now it is a contradiction.  The real economy is near-dead while Wall Street, thanks to Trillions of dollars pumped into the market back in March '09, has thus far made up about 60% of its pre-Lehman Brothers level.  It is 100% artificial and the success of Wall Street does NOT trickle down in any meaningful way to Main Street, USA.

--  In summary, Ben Bernanke is an F-ing Liar.  No way to sugarcoat it.  Most people haven't a clue what the Fed is, its role or purpose or what has been going on under Bernanke's watch in particular the past two years. Our tax dollars have gone to help multinational corporations, banking interests and investors make large profits while the quality of life for the bottom 98% has deteriorated.  And the media are just ignorant lap-dogs who will happily regurgitate any positive spin to convey 'recovery'.

The US Govt has spent $14 trillion dollars since Sept. 08 to re-start the economy and despite BS declarations such as the recession being over as of June, 2009,  unemployment officially is still close to 10%  (unofficially it is over 17%), banks aren't lending, personal bankruptcies and foreclosures are sky-high and prices are going up for food, gasoline and other essentials.  Bernanke's attempts to stimulate the economy have been an abject Failure.  Thus--  Bernanke is an F'-ing Liar.

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