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Saturday, November 6, 2010

Mish's Global Economic Trend Analysis

Bold-Faced Lies of the Day from Geithner, Bernanke

Posted: 06 Nov 2010 05:41 PM PDT

How can anyone take blatant liars seriously? How can anyone not know Bernanke and Geithner are blatant liars?

I have not figured out the answer to those questions but I can point out another round of lies from both Geithner and Bernanke.

Bernanke's Lie of the Day

MarketWatch reports Fed chairman: Increasing inflation not a goal

Some Fed critics have accused the bank of pursuing an inflationary strategy by adding trillions of dollars of credit into the nation's financial system. The Fed itself seemed to suggest inflation was too low in a policy statement two months ago.

Yet Fed Chairman Ben Bernanke said Saturday that the central bank's decision this week to purchase $600 billion in Treasury bonds is solely aimed at keeping U.S. interest rates low so the economy can grow.

"We are not in the business of trying to create inflation," Bernanke said at a forum in Georgia to discuss the role of the central bank in the U.S. economy.

Bernanke said prior actions indicated monetary policy was "insufficiently stimulative." He said the possibility of deflation, or falling prices, has posed a bigger threat.

Of course the Fed is in the business of producing inflation. It is their first and foremost goal, just as it is in Japan. Consequences, such as asset bubbles be damned.

Bernanke belongs on the cover of Mad Magazine with his "What me Worry?" attitude about asset bubbles. He could not spot a housing bubble even though it was obvious to practically everyone on the planet except the other members of the Fed, real estate agents, and home builders.

Geithner's Lie of the Day

Bloomberg reports Geithner Says U.S. Won't Use Dollar to Gain Economic Advantage

Treasury Secretary Timothy F. Geithner said the U.S. won't use the dollar as a trade weapon and he repeated his support for a "strong dollar" that plays a central role in the global economy.

"We will never use our currency as a tool to gain competitive advantage," Geithner told reporters today after a meeting of finance ministers from the Asia-Pacific Economic Cooperation group in Kyoto, Japan.

The Treasury chief said he believes the dollar, euro and yen are roughly in alignment with each other, and he said American policy makers understand the "special responsibility" the U.S. has for the world economy. "I'm happy to reaffirm again that a strong dollar's in our interest as a country," Geithner said.

If a strong dollar was in the best interest of the country, then Geithners would not be pressuring China to weaken it. Bernanke would not be out to destroy it.

I am delighted that Rand Paul won a senate seat. He will have a chance to stick it to Bernanke during the Fed Chairman's semi-annual ~~testimony~~ charade before Congress, formally known as the Humphrey Hawkins Testimony and Report.

Is Obama a Keynesian?

Let's try one more time. The last Youtube I posted was restricted.

This is one of the funniest things I have seen in a while.