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The Fed wants higher food prices!

batazoid

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I simply cannot believe Ben Bernake, Chairman of the Federal Reserve, said this: "If the Fed were to communicate that it will tolerate a higher-than-normal rate of inflation, that could make companies feel more inclined to nudge up their prices. Shoppers, thinking prices would be rising even further in the future, would be more inclined to make purchases sooner. That would lift inflation from worrisome low levels." [color=#ff000]Click here[/color] for source.

bmb_bernanke_80x91.jpg


Hasn't[GOOGLE] Bernake[/GOOGLE] been inside a Walmark recently to buy groceries? Noboby needs to "scare" the public right now with higher food prices. Prices are going up all by themselves. What we need to do to turn this economy around is to place more money in the hands of those consumers who will be forced by their own dire economic circumstances to spend what little they receive directly back into the economy.

Indications are, we will need to provide further funding to deal with rising unemployment figures after these mid-term elections for at least two more years, without raising the deficit. I think it only reasonable to suggest using some of the Bush tax cut extension as a means of addressing this problem. By permanently extending 85% of the middle class tax cuts and 75% of the "wealthy" tax cuts, funding can be procured to create a new WPA (Works Project Administration) type program that would include a new "must work" provision to receiving further unemployment benefits.

ex animo
silent_hill_movie_5.gif

batazoid
 
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Hicup

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I simply cannot believe Ben Bernake, Chairman of the Federal Reserve, said this: "If the Fed were to communicate that it will tolerate a higher-than-normal rate of inflation, that could make companies feel more inclined to nudge up their prices. Shoppers, thinking prices would be rising even further in the future, would be more inclined to make purchases sooner. That would lift inflation from worrisome low levels." [color=#ff000]Click here[/color] for source.

bmb_bernanke_80x91.jpg


Hasn't[GOOGLE] Bernake[/GOOGLE] been inside a Walmark recently to buy groceries? Noboby needs to "scare" the public right now with higher food prices. Prices are going up all by themselves. What we need to do to turn this economy around is to place more money in the hands of those consumers who will be forced by their own dire economic circumstances to spend what little they receive directly back into the economy.

Indications are, we will need to provide further funding to deal with rising unemployment figures after these mid-term elections for at least two more years, without raising the deficit. I think it only reasonable to suggest using some of the Bush tax cut extension as a means of addressing this problem. By permanently extending 85% of the middle class tax cuts and 75% of the "wealthy" tax cuts, funding can be procured to create a new WPA (Works Project Administration) type program that would include a new "must work" provision to receiving further unemployment benefits.

ex animo
silent_hill_movie_5.gif

batazoid

Bernanke is an idiot, sorry to say it, but he is. He's either that, or a lapdog for the Obama Admin, and we already know they have no clue when it comes to the economy.

Look, it isn't rocket science folks. It never has been! Give people their hard earned money, and they will spend it, especially when they have confidence that they're receiving value for their dollars.

Stop spending (Pipe dream) on things like buying votes, "gifts", stupid social legislation, and put the money back in the hands of the people.

Nutshell.. Stop tinkering.. The only thing the Government should ever be doing in the market is to prevent monopolies by encouraging competition, regulate consumer disclosure, and let the people decide what they want to buy. You could literally wash your hands as the government by lifting all regulations, and resitrictions on the sale, and exchange of commerce, by spending more time on regulating full disclosure. Never happen I know. There's way too much to corrupt by legislating EVERYTHING for our government to release the hounds..

But it is whaty needs to be done. We are supposed to be free, right?


Tim-
 

batazoid

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Look, it isn't rocket science folks. It never has been! Give people their hard earned money, and they will spend it, especially when they have confidence that they're receiving value for their dollars.

The problem with this statement is the consumers, themselves; who make up 70% of the economy. They can't or won't buy enough to turn the economy around until they are convinced the economy is stabilized, that a strong economic recovery lies just around the corner, and that their present household debit has been significantly reduced to manageable levels vis-à-vis their own household income. Until these conditions are met, no amount of Fed tinkering or scare tatics will stimulate the economy.

What we need to do to turn this economy around, and turn around slowly*, is to place more money in the hands of those consumers who will be forced by their own dire economic circumstances to spend what little they receive just to stay afloat back into the economy by extending unemployment benefits for at least the next two years, until 2012.

To pay for this extension, without increasing the deficit, we need to use some of the Bush tax cut extension. By permanently extending 85% of the middle class tax cuts and 75% of the "wealthy" tax cuts, $40 billion per year in funding can be procured to create a new WPA (Works Project Administration) type program that would include a new "must work" provision for those receiving further unemployment benefits i.e. after their 99 weeks have run out.

With this extra $40 billion per year, we can accomplish three things: First, and foremost, we can directly stimulate a deflationary economy. Secondly, help those most in need of financial help during these continuing hard economic times for the common good of all, and, thirdly: avoid growing the country's deficit.

ex animo
thchrishansenhk9.gif

batazoid

* Actually, if the economy increases too fast, inflation will be the very last thing the Fed would want to promote. At present our economy is awash with Fed dollars. Businesses aren't hiring because they don't presently see their market expanding, not because they don't have to money to expand.
 

Hicup

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The problem with this statement is the consumers, themselves; who make up 70% of the economy. They can't or won't buy enough to turn the economy around until they are convinced the economy is stabilized, that a strong economic recovery lies just around the corner, and that their present household debit has been significantly reduced to manageable levels vis-à-vis their own household income. Until these conditions are met, no amount of Fed tinkering or scare tatics will stimulate the economy.

What we need to do to turn this economy around, and turn around slowly*, is to place more money in the hands of those consumers who will be forced by their own dire economic circumstances to spend what little they receive just to stay afloat back into the economy by extending unemployment benefits for at least the next two years, until 2012.

To pay for this extension, without increasing the deficit, we need to use some of the Bush tax cut extension. By permanently extending 85% of the middle class tax cuts and 75% of the "wealthy" tax cuts, $40 billion per year in funding can be procured to create a new WPA (Works Project Administration) type program that would include a new "must work" provision for those receiving further unemployment benefits i.e. after their 99 weeks have run out.

With this extra $40 billion per year, we can accomplish three things: First, and foremost, we can directly stimulate a deflationary economy. Secondly, help those most in need of financial help during these continuing hard economic times for the common good of all, and, thirdly: avoid growing the country's deficit.

ex animo
thchrishansenhk9.gif

batazoid

* Actually, if the economy increases too fast, inflation will be the very last thing the Fed would want to promote. At present our economy is awash with Fed dollars. Businesses aren't hiring because they don't presently see their market expanding, not because they don't have to money to expand.

Just curious. What kind of conservative are you? Are you socially conservative, coz you sure ain't fiscally conservative. You honeslty sound like Nancy Pelosi?

When people meet dire circumstances, or business, or any economic entity for that matter, the market corrects. It, in a sense, revalues capital. All this stimulus, bailouts, and extending benefits is artificial. Markets are based off tangible capital of good and services. All the tinkering by the Fed is intangible, and also unsustainable. Markets don't like intangibles, they are anti-market indicators which serve no real purpose other than to band-aid certain segments, but not an economy as a whole.


Tim-
 
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batazoid

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Just curious. What kind of conservative are you? Are you socially conservative, coz you sure ain't fiscally conservative. You honeslty sound like Nancy Pelosi?

I am a fiscally conservative, but I am not a dang fool about it. We are presently way beyond normal, ordinary market forces.

Yes, I totally agree with your statement:
"When people meet dire circumstances, or business, or any economic entity for that matter, the market corrects. It, in a sense, revalues capital. All this stimulus, bailouts, and extending benefits is artificial. Markets are based off tangible capital of good and services. All the tinkering by the Fed is intangible, and also unsustainable. Markets don't like intabgibles, they are anti-market indicators which serve no real purpose other than to band-aid certain segments, but not an economy as a whole."

But by simply going "cold turkey", as you suggest, is not possible given our present situation. As I pointed out, even if we instantly followed your advice by stopping all economic meddeling by the Feds in the market, and the market, in your terms, instantly bounces back to record profits, with record hirings, and record expansion, wild, almost uncontrollable inflation would be the result.

ex animo
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batazoid
 

Hicup

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Batazoid -
But by simply going "cold turkey", as you suggest, is not possible given our present situation. As I pointed out, even if we instantly followed your advice by stopping all economic meddeling by the Feds in the market, and the market, in your terms, instantly bounces back to record profits, with record hirings, and record expansion, wild, almost uncontrollable inflation would be the result.

Look, I generally stay away from discussion here about economics. For various reasons really, but mostly because people who claim to know, really don't know, and those that graduate with a degree in economics are the worst offenders. There is no such thing as an economic scientist, or economics labelled as science. There's nothing scientific about it, unless "chaos-theory" is considered viable.. :)

I am curious though how you reach the conclusion that by immediately lifting all regulation on business with the immediate requirement of FULL public disclosure that all hell would break loose? What do you base this on?


Tim-
 

batazoid

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"...by immediately lifting all regulation on business with the immediate requirement of FULL public disclosure"...

I was talking about a monetary policy, not regulatory and disclosure policies.

Be that as it may; any time the Fed buys anything now days it does so with "deficit" dollars. Raising the deficit, devalues the dollar. Anytime you devalue the dollar, you decrease savings while increasing spending.

ex animo
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