As expected, Ben Bernanke provided a rational for more quantitative easing Friday, declaring: "Inflation is running at rates that are too low relative to the levels the [FOMC] judges to be most consistent with the Federal Reserve's dual mandate" of price stability and full employment.
Predictably, Euro Pacific Capital president Peter Schiff wholeheartedly disagrees with that - and just about everything else Bernanke says.
"It's scary how clueless Bernanke is," Schiff says, noting the dollar is at or near record lows vs. several major currencies and commodities from agriculture to zinc are soaring.
"That is inflation," he says, dismissing this morning's tame CPI data as hedonically adjusted government fiction. "As money loses value prices are going to rise because you need more diminished dollars to buy goods and services."
Moreover, Bernanke's suggestion that more inflation will spur employment growth is the really "crazy thing" in today's speech, Schiff says. "You don't create jobs by creating inflation," he says. "You create jobs by reducing regulation and lowering taxes."
A pure libertarian and devote of the Austrian school of economics, Schiff expressed two main concern about Bernanke's policies:
One, the government is trying to prop up an economy based on debt-fueled consumption, rather than letting it "restructure," albeit from much lower levels.
Two, more quantitative easing will lead to more big government.
"What Ben Bernanke is saying to Congress is ‘run up the deficits because I'm going to monetize it for you,'" Schiff says. "He is enabling the government to get bigger, which is going to make employment worse, not better. He's throwing gasoline on a fire."
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so true
Lots of words - but what would HE do ??
Nice translation there of the man him self., Bear thy name Bernake :-)
This is just crazy. The Govt is crashing the economy and the currency... We're toast unless we vote ALL the bums out. Then we have a small chance that the new guys will try to save the dollar, and the economy.
It is interesting that even I ( a 2 year Associate Degree in Nursing) know the Financial Experts do not know what they are doing. I would start making jobs available in construction to rebuild intrastructure. I would call it trickle up economics.
Dollar dips, our goods are cheaper overseas, we sell more, more employed. Works for me.
Maybe the next President should appoint Mr. Schiff to replace Mr. Bernanke in 2012. Since the current approach didn't work so well, it's worth trying something different.
It's as simple as that. Inflation is too high, currency (my savings)is being destroyed, and Obamanation socialism celebrates expanding government. Gov. union numbers increasing, private union numbers decreasing.
Big Ben Bernanke has no clue as to our economic problems and is clueless on the solution to the problem. And neither does Congress or the White House. Trash the dollar and energy prices will skyrocket. Cap & Trade will cause even higher prices. And we have seen the result of $5 gas prices in 2008. Are we about to repeat history?
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