I'm skeptical, but when Palin starts making speeches about monetary policy, somethings afoot. [rquoter]I’m deeply concerned about the Federal Reserve’s plans to buy up anywhere from $600 billion to as much as $1 trillion of government securities. The technical term for it is “quantitative easing.” It means our government is pumping money into the banking system by buying up treasury bonds. And where, you may ask, are we getting the money to pay for all this? We’re printing it out of thin air. The Fed hopes doing this may buy us a little temporary economic growth by supplying banks with extra cash which they could then lend out to businesses. But it’s far from certain this will even work. After all, the problem isn’t that banks don’t have enough cash on hand – it’s that they don’t want to lend it out, because they don’t trust the current economic climate. And if it doesn’t work, what do we do then? Print even more money? What’s the end game here? Where will all this money printing on an unprecedented scale take us? Do we have any guarantees that QE2 won’t be followed by QE3, 4, and 5, until eventually – inevitably – no one will want to buy our debt anymore? What happens if the Fed becomes not just the buyer of last resort, but the buyer of only resort? All this pump priming will come at a serious price. And I mean that literally: everyone who ever goes out shopping for groceries knows that prices have risen significantly over the past year or so. Pump priming would push them even higher. And it’s not just groceries. Oil recently hit a six month high, at more than $87 a barrel. The weak dollar – a direct result of the Fed’s decision to dump more dollars onto the market – is pushing oil prices upwards. That’s like an extra tax on earnings. And the worst part of it: because the Obama White House refuses to open up our offshore and onshore oil reserves for exploration, most of that money will go directly to foreign regimes who don’t have America’s best interests at heart. We shouldn’t be playing around with inflation. It’s not for nothing Reagan called it “as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man.” The Fed’s pump priming addiction has got our small businesses running scared, and our allies worried. The German finance minister called the Fed’s proposals “clueless.” When Germany, a country that knows a thing or two about the dangers of inflation, warns us to think again, maybe it’s time for Chairman Bernanke to cease and desist. We don’t want temporary, artificial economic growth bought at the expense of permanently higher inflation which will erode the value of our incomes and our savings. We want a stable dollar combined with real economic reform. It’s the only way we can get our economy back on the right track.[/rquoter]
I'm sure she has deep insights on the most complicated economic issue of the day. Maybe Liberty University will give her an honorary PHD in economics.The truth is no one knows which plan insures a more stable future for the American Middle Class. Much like the bailouts, you try to think it out but in the end it's just a guess. And that's all you really have and there will be no way to evaluate the results against the other, un-enacted alternatives. The choice seems to me to be: 1. monetizing the debt it is taking to get us out of recession so that it's future impact is mitigated by inflation; an inflation that starts a rise in stock and home prices so people can get ahead a little. 2. infusing the system with massive amounts of cash that may not reach the wage earners but will inflate the costs of all commodities possibly crushing margins and making stagnant wages worth even less. But I admit I am a dilettante, does mammagrizz?
We shouldn't be using monetary policy to revive the economy. That's playing with fire. Monetary policy is for keeping our currency stable, period.
we're not spending 600 billion. we're spending a couple billion. not that it's useful or smart. instead we should pass a stimulus. but since palin's pals in congress refuse to make smart decisions, we make half assed ones that don't really help and piss everyone off. and screw emerging economies without china like capital controls.
You realize the fed has been grappling with monetary policy for the past two years split on what to do. The QE won out after everyone concluded our economy is on verge of a double dip recession. The economy is a mess. Nearly all economists, including Bernanke and the fed think the right course of action is another stimulus. That's universally deemed the correct course of action. But the political environment is so hostile to that nothing can be done. So that is why the fed is pursuing this course, essentially to prevent economic collapse.
It's absolutely hysterical to hear conservatives suddenly so alarmed about deficit spending. If only they had been in control this deficit might have been prevented! Oh wait.
We have been using monetary policy to "revive" the economy for the last 30 years, at least... Palin has no idea what she's talking about, and she hasn't for the last 30 years, at least...
Palin is smart because she has those trendy glasses. It's people like her who stoke gridlock in policy issues to exploit personal gain. People like Paul who want Fed power back into Congress, either don't care or are ignorant of a lumbering Congress who can't deal with instantaneous monetary issues that's becoming quicker and quicker by the minute. He's probably a rube who loves gridlock. Yeah, keep voting in that pork out of "principle". http://www.ft.com/cms/s/0/6d23b038-e844-11df-8995-00144feab49a.html
At some point, the real economy will start to get better. We have doubled the M0 in 2 years. If lending goes back to where it was before October 2008, the purchasing power of the dollar will be cut in half. The truth is that lending won't go back to where it was before, so the purchasing power of the dollar will "only" go down by 30-40%, but that's still pretty dramatic, and pretty painful for the poor and middle class. Heckuva job, Bennie!
except economists in foreign countries the fed is ensuring America's economic collapse. this is the easiest forecast of all time.
There is a lot of shady activity associated with the oft-praised Clinton deficit reduction. No argument or statement intended other than that which was made.
Well your argument shows data for 20 yeas of republicans and 8 years of Dems. Clinton got help from Bush, and it got Bush fired.
Yes. So? There were plenty of other reasons. However, I think your original argument about Bush's tax increases helping Clinton are fair.
