"quantitative easing" it begins........ (money, unemployment, closing, currency)

[Maabus1999]

Yes I know about all the central banks (First US bank, etc...) all from the starting idea of Alexander Hamiliton. Trying the "you don't know what you are talking about since I can Google something" attitude is not helpful to your case.

Again, hard data disagrees with you (from several countries) that moneteray policy/intervation is "always" making things worse, when in fact it "rarely" has, and is why every country in the G-20 has a central bank. Nothing is perfect in a human world, but believing a central bank creates pseudo human slavery is absurd.

If China didn't (doesn't *caveat*) use its central bank to remove liquidity from its current market, you would be seeing one of the worse bubbles in history forming. They still will have a bubble(and a crash), but it won't be nearly as severe as just letting it run in a system you propose.

That is the central banks job. Not to eliminate bubbles/recessions but to mitigate them.

Heck, I could make claims that it is the American media that is the cause of over consumption with the plan to keep everyone wanting more and more in a false reality that they create in order to transfer wealth to themselves. That is basically the style of arguement you are making with the Federal Reserve, as it is just opinion.

Also a few of your quotes have merit but you are taking a few, like Jefferson's, out of context when you apply it to the Federal Reserve.

[jimhcom]

Originally Posted by Maabus1999

Yes I know about all the central banks (First US bank, etc...) all from the starting idea of Alexander Hamiliton. Trying the "you don't know what you are talking about since I can Google something" attitude is not helpful to your case.

Again, hard data disagrees with you (from several countries) that moneteray policy/intervation is "always" making things worse, when in fact it "rarely" has, and is why every country in the G-20 has a central bank. Nothing is perfect in a human world, but believing a central bank creates pseudo human slavery is absurd.

If China didn't (doesn't *caveat*) use its central bank to remove liquidity from its current market, you would be seeing one of the worse bubbles in history forming. They still will have a bubble(and a crash), but it won't be nearly as severe as just letting it run in a system you propose.

That is the central banks job. Not to eliminate bubbles/recessions but to mitigate them.

Heck, I could make claims that it is the American media that is the cause of over consumption with the plan to keep everyone wanting more and more in a false reality that they create in order to transfer wealth to themselves. That is basically the style of arguement you are making with the Federal Reserve, as it is just opinion.

Also a few of your quotes have merit but you are taking a few, like Jefferson's, out of context when you apply it to the Federal Reserve.

Bubbles are not driven by money supply, as few big ticket, or small ticket items for that matter, in our economy are purchased with cash.
We live in a credit driven society, where the supply and ease of credit is controlled by the FED. Therefore the responsibility of credit driven bubbles also remains with the FED. I really do not know how much simpler I can put it. As far as Jefferson he mistrusted banks in general and central banks in particular. Are you denying that?

[shrewdnlewd]

Originally Posted by jimhcom

Bubbles are not driven by money supply, as few big ticket, or small ticket items for that matter, in our economy are purchased with cash.
We live in a credit driven society, where the supply and ease of credit is controlled by the FED. Therefore the responsibility of credit driven bubbles also remains with the FED. I really do not know how much simpler I can put it. As far as Jefferson he mistrusted banks in general and central banks in particular. Are you denying that?

You have no concept of reserve banking or "money supply". Credit is ABSOLUTELY dependent on money supply.

Inflation tamed growth if the goal of every central bank. Monetary policy is the method of attaining that. Appreciation of assets IS the goal, bubbles are not. I'd like to see your framework of living in a deflationary, no growth environment where we all change the game and start chasing fewer goods with less money (real or not). We try to solve the economic problem without discrimination, however, social science is never perfect. Good luck with your future endeavors.

Edit: Thought I would mention, as it is relevant, that on Friday the 27th of August, bonds fell in price the most they had in the past ten years. The Fed reassured us that they will not allow deflation. Complacency with your money will be suicide. A wise person would add debt and assets. Allow the assets to appreciate while debt remains constant if you get fixed rate financing.

[jimhcom]

Originally Posted by shrewdnlewd

You have no concept of reserve banking or "money supply". Credit is ABSOLUTELY dependent on money supply.

Inflation tamed growth if the goal of every central bank. Monetary policy is the method of attaining that. Appreciation of assets IS the goal, bubbles are not. I'd like to see your framework of living in a deflationary, no growth environment where we all change the game and start chasing fewer goods with less money (real or not). We try to solve the economic problem without discrimination, however, social science is never perfect. Good luck with your future endeavors.

Edit: Thought I would mention, as it is relevant, that on Friday the 27th of August, bonds fell in price the most they had in the past ten years. The Fed reassured us that they will not allow deflation. Complacency with your money will be suicide. A wise person would add debt and assets. Allow the assets to appreciate while debt remains constant if you get fixed rate financing.

The game has changed in case you have not noticed. The Fed's actions have driven the country into the worse depression since 1929.
Their attempts to save the economy by QE have been impotent at best. Asset deflation in real estate and equities will continue because their prices are fundamentally overvalued.
Unemployment will continue to increase for the private sector and government will continue to be a larger and larger part of the economy. By all means purchase all the assets you want, personally, I will wait until all the chickens come home to roost and do my purchasing at much lower prices. Economies are driven by consumers, and the consumers are in a bad way. Too far in debt, declining wealth, under employed, and loosing the precious time they needed to compound their savings and investments. As far as putting faith and confidence in the Fed and their statements, the Fed has a track history of being either completely incompetent, or blatant liars. If you do not believe it just read their statements from the past.

“I believe that the general growth in large [financial] institutions have occurred in the context of an underlying structure of markets in which many of the larger risks are dramatically — I should say, fully — hedged.”
– Alan Greenspan, 2000

“Even though some down payments are borrowed, it would take a large, and historically most unusual, fall in home prices to wipe out a significant part of home equity. Many of those who purchased their residence more than a year ago have equity buffers in their homes adequate to withstand any price decline other than a very deep one.”
– Alan Greenspan, October 2004

Financial innovation means “shocks may be less likely to result in the type of trend amplifying, self-reinforcing dynamic for sustained periods of time that can threaten the stability of the financial system… but it is unlikely to have brought an end to the periodic tendency of markets to experience waves of mania and panic.”
– Tim Geithner, Oct. 1, 2004

“Improvements in lending practices driven by information technology have enabled lenders to reach out to households with previously unrecognized borrowing capacities.”
– Alan Greenspan, October 2004

“The use of a growing array of derivatives and the related application of more-sophisticated approaches to measuring and managing risk are key factors underpinning the greater resilience of our largest financial institutions …. Derivatives have permitted the unbundling of financial risks.”
– Alan Greenspan, May 2005

“We’ve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s gonna drive the economy too far from its full employment path, though.”
– Ben Bernanke, July 2005

“In the financial system we have today, with less risk concentrated in banks, the probability of systemic financial crises may be lower than in traditional bank-centered financial systems.”
– Tim Geithner, May 16, 2006

“The Federal Reserve is not currently forecasting a recession.”
– Fed chairman, Ben Bernanke, January, 2007

“At this juncture, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained.”
– Fed chairman, Ben Bernanke, Congressional Testimony, March, 2007

[jertheber]

The simple truth is that the entire construct of our monetary system was designed to provide the advantage of capital over labor. In this type of system the proles always are left to deal with the consequences, does it matter what kind of gears, chains and sprockets are utilized in the fleecing of the laboring classes? The Fed and it's originators had one thing in mind when they came up with the idea of a central system wherein the collective wealth of a nation would be handed off to those in the most powerful sectors of private enterprise. In that way it works pretty well.

Any attempt to characterize the banking system in America as some kind of innocent pawn of the deceitful few would be missing the mark by a mile. Banking is the kingdom of deceit, by it's very nature it must be predatory, there is no other way in which it can profit. Banks contribute nothing in the way of durable goods or essential services, period. It really won't matter if the so called quantitative easing or whatever the latest buzzword does to us in the lower strata, we'll be hearing a ton of this kind of speculative re-engineering of the terms used to describe the screwing we're going to get, but, we are going to get a major arse kicking and that won't change because we call it by another name......

[CosmicWizard]

jimhcom wrote:

As far as putting faith and confidence in the Fed and their statements, the Fed has a track history of being either completely incompetent, or blatant liars. If you do not believe it just read their statements from the past.

The statements of financial wizards like Alan Greenspan, Tim Geithner, & Ben Bernanke, are about as believable as the testimony of Barry Bonds, and Roger Clemons regarding steriod usage. Greenspan, Geithner, & Bernanke are 3 of the biggets liars on the planet.

[shrewdnlewd]

Hi guys, where do I go for a serious discussion about monetary policy ? So far all I've found is a lot of FUD ranchers retorting my arguments with Fed hatred. Pure and simple.

Last time I checked we are posting in the "Business, Finance & Investing" forum... can we get some analysis on what to expect in the markets from the FED's effort to stave off deflation and return growth to the economy?

In reply to you post Jim, how do you suppose the Unemployment rate will go down before the economy returns to stable growth ? There's a necessary process of things that have to happen in a certain order as we recover out of this recession. I understand that things are going slow much to the displeasure of the electorate. However, it does not give anyone carte blanch authority to vilify the Fed and make them scapegoats for all things recessionary. I fear to think about the state of the Union right now if the fed had tightened monetary policy starting in Q4 2008 !!!!!!!!

Next time you harp on the Fed, think about what could be reality right now. Like Maabus said, the central bank's role is to MITIGATE bubbles.

When it comes to Fed statements, the ones I pay attention to are those where they give direction on what actions they are taking in the markets. Forward looking "crystal ball" statements can come around to bite anyone in the ass so it is best to ignore them IMO.

[LeavingMA]

Originally Posted by shrewdnlewd

Hi guys, where do I go for a serious discussion about monetary policy ? So far all I've found is a lot of FUD ranchers retorting my arguments with Fed hatred. Pure and simple.

Last time I checked we are posting in the "Business, Finance & Investing" forum... can we get some analysis on what to expect in the markets from the FED's effort to stave off deflation and return growth to the economy?

In reply to you post Jim, how do you suppose the Unemployment rate will go down before the economy returns to stable growth ? There's a necessary process of things that have to happen in a certain order as we recover out of this recession. I understand that things are going slow much to the displeasure of the electorate. However, it does not give anyone carte blanch authority to vilify the Fed and make them scapegoats for all things recessionary. I fear to think about the state of the Union right now if the fed had tightened monetary policy starting in Q4 2008 !!!!!!!!

Next time you harp on the Fed, think about what could be reality right now. Like Maabus said, the central bank's role is to MITIGATE bubbles.

When it comes to Fed statements, the ones I pay attention to are those where they give direction on what actions they are taking in the markets. Forward looking "crystal ball" statements can come around to bite anyone in the ass so it is best to ignore them IMO.

Not to get back into it, but do you actually think the Fed has controlled the bubbles?

Many here believe that the Fed is part of the problem and it is difficult to analyze the market with them interfering and trying to control everything.

[CosmicWizard]

shrewdnlewd wrote:

Hi guys, where do I go for a serious discussion about monetary policy ? So far all I've found is a lot of FUD ranchers retorting my arguments with Fed hatred. Pure and simple.

Last time I checked we are posting in the "Business, Finance & Investing" forum... can we get some analysis on what to expect in the markets from the FED's effort to stave off deflation and return growth to the economy?

You can lower your frustration level by simply appreciating whatever is being posted.....even if you don't like it. I don't agree with your viewpoint, but I have no desire to limit what you say or how you say it. Continue to speak your mind, even if you must resort to name calling.

[shrewdnlewd]

Hi Cosmic, you are right. I apologize.

Leaving MA, It is impossible to know how many bubbles the Fed has successfully averted. Every time a lever of monetary policy is manipulated, it is done in a deliberate manner towards the result of managed growth.

Bubbles can emerge due to various reasons. Some can be traced back to the executive branch, some to Congress, some to the Fed but a lot of it lies with human psychology. We tend to assume too many constants occurring in the future and take risks trying to capitalize on them. When a lot of us start doing the same things for x duration, demand outstrips supply causing prices to go up. When the apparent constants turn and change and asset values fall in a cascading motion, we have a crash.