Tag: Federal Reserve

On The Way To The Fed

Over a year now Donny has been doing nothing but bad mouthing the Fed and now he has his chance to modify it to his way of thinking.

President Trump has made his choice for Fed chairman. The president, who teased the announcement Thursday night, said in a Truth Social post Friday morning that he is nominating economist Kevin Warsh, a former Fed governor, to replace Jerome Powell, whose term ends in May.

  • “I have known Kevin for a long period of time, and have no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best,” the president wrote in a lengthy post listing Warsh’s accomplishments. “On top of everything else, he is ‘central casting,’ and he will never let you down.”

Warsh was a finalist in 2017 but lost out to Jerome Powell, who was renominated by Joe Biden in 2021. Trump later turned on Powell and has repeatedly said he regretted not picking Warsh, the Wall Street Journal reports. “Kevin, I could have used you a little bit here. Why weren’t you more forceful when you wanted that job?” Trump said at an event in 2020. “I would have been very happy with you.” Warsh, 55, became the youngest governor in Fed history in 2006.

Warsh served as a Fed governor during the 2008-2009 financial crisis and has since become one of the institution’s sharper critics. He was long a “hawk” who pushed for higher interest rates to control inflation but has more recently changed his position and pushed for faster interest rate cuts, aligning with Trump’s position, the AP reports. Warsh, once a free-trade advocate, has also lined up with Trump on tariffs, a position that could ease tensions between the White House and the Fed if he’s confirmed. The BBC reports that Warsh has a family connection to Trump: His father-in-law is billionaire businessman Ronald Lauder, a longtime Trump donor.

Confirmation is not guaranteed, the Journal notes. The Senate must sign off, and Sen. Thom Tillis, a Republican on the Banking Committee, has vowed to block Trump’s Fed nominees while the Justice Department investigates Powell’s testimony about Fed building renovations—an inquiry Powell has described as a pretext to force lower rates. Warsh emerged as Trump’s favored candidate over National Economic Council director Kevin Hassett and two other finalists, BlackRock executive Rick Rieder and current Fed governor Christopher Waller.

Do not get excited yet….he is nominated but not confirmed by Congress.

If confirmed will he be just another Trump puppet?

But he has an ever changing opinion and that tells me he will most likely do whatever Donny boy wants…I do not see him stand up against a Trump onslaught….

Do You?

I Read, I Write, You Know

“lego ergo scribo”

The Fed And The Battle Royale

The big story for awhile now is the struggle Donny is having with the Fed….

There has been a major back and forth between Donny and the chairman of the Fed on interests rates.

The Fed is keeping rates where they are (for now) and Donny the Orange wants the rates to go lower (basically because of his tariffs)….and since the rates will remain Donny has been threatening to fire (get rid of the chairmen basically because he will not do what he is told).

So if SCOTUS has stated that he cannot be fired….

The Supreme Court on Thursday said the relationship between the president and the Federal Reserve is different from that of other independent agencies, signaling that Chair Jerome Powell is legally protected from being removed by President Donald Trump.

“The Federal Reserve is a uniquely structured, quasi-private entity that follows in the distinct historical tradition of the First and Second Banks of the United States,” they added.

Will that put an end to his persecution of the Fed?

But Donny is like a dog with a bone….he will send his minions out to look in every nook and cranny and find something he can use against the chairman….and he may have found something he can use….

President Trump is not a fan of Federal Reserve Chair Jerome Powell, but the president insists that he won’t fire him before his term ends next spring. However, a new White House investigation is fueling speculation that he may reconsider, reports Politico. The probe centers on the $2.5 billion renovation of the Fed’s headquarters in DC and suggests the administration is seeking grounds—beyond monetary policy disputes—to remove Powell for alleged mismanagement, per the Wall Street Journal.

The White House has repeatedly criticized Powell for not cutting interest rates, but this latest move pivots to focus on administrative issues, specifically cost overruns on the project and whether Powell misled Congress about it. White House Budget Director Russ Vought says those cost overruns are “horrifying” and are under investigation. Some analysts, including Karen Petrou of Federal Financial Analytics, view the investigation as an attempt to build a case for firing Powell “for cause,” sidestepping legal protections for the Fed’s independence.

The renovation reportedly grew more expensive due to design changes, asbestos removal, and inflation—the same inflation Powell cites for keeping rates higher. Critics note that cost overruns are typical for renovations of historic buildings and argue that tying Powell’s fate to the project’s expenses could be seen as a pretext for installing a more compliant Fed chairman.

Fascinating!

He will use this as a weapon but condemns those that use the extravagant birthday parade because of the costs….just one example.

How will this sage end?

Will Powell get the ax?

If he does who will Donny put in charge….maybe that idiot Laffer….you know him as the mastermind behind the GOP’s greatest scam….the ‘trickle Down Theory”.

The most incompetent people are in charge throughout the government and Laffer would be perfect fit for the Trump kakistocracy…

I Read, I Write, You Know

“lego ergo scribo”

Delusional Amount Of Cash

I see that the Congress has left town , go figure, that is the one thing they all agree on, without any action on the new economic stim package to help the country deal with the costs of the pandemic.

People will soon lose or have their benefits cut or lost….and yet the only ones showing a profit out of the pandemic is corporations that are 100s of million of dollars that have seen profits jump by double digits……and what is the answer for the Fed?

Give the rich bastards more cash…..

Federal Reserve officials have launched what amounts to a full court press aimed at ensuring that Congress provides a further fiscal stimulus to corporations, as the COVID pandemic continues out of control and the limited revival of the US economy stalls.

While Fed representatives always couch their remarks in terms of giving assistance to the economy and even to workers, the fall in the stock market since the beginning of the month—the most significant downturn since the plunge in mid-March, when all financial markets froze—is the underlying concern.

The push began on Tuesday, when Fed Chair Jerome Powell gave testimony before the House of Representatives Committee on Financial Services. Powell repeated earlier calls for fiscal action, on top of the more than $3 trillion made available under the CARES Act.

https://www.wsws.org/en/articles/2020/09/25/econ-s25.html

All this leads me to ask the one simple question….why do we give corporations so much power over our lives?

The media leads us to believe that the markets going up is good for the people….it is not the only people that benefit are the CEOs.

Then why do we give them the power?

The American people own most of the wealth—private and public—and most of the information in the country. The top one percent do not.

The American people have most of the power in the country. The top one percent do not.

(If you believe any of that then I have a bridge I will sell cheap)

These assertions may surprise you, because the top one percent and the giant corporations work overtime to control what you own. This means they do not have to seize what you own so long as their control provides them with both riches and power over you.

Let’s spell this out with specifics. Our Constitution starts with the words, “We the People…”; it doesn’t start with ‘we the corporations’ or ‘we the Congress’ or ‘we the super-rich.’ The sovereign authority under the Constitution is us; we the people are the bosses. But we give our power away to the Big Boys who run the big companies that control most of our elected politicians. The politicians in turn proceed to corrupt our elections with campaign money, gerrymandering, deceitful ads, voter obstructions, and a totally dominant two-party duopoly. This corporate state destroys competitive democracy which would give our votes meaning, choices, and effectiveness.

The corporate “Borg” is sucking the ready availability of the good life, decent, secure livelihoods assured by our collective self-reliance, and the freedom to shape our future out of our political economy.

We have been brainwashed….and it has been a rousing success for we equate our personal success by others standards.

For Christ Sake—-Learn Stuff!

I Read, I Write, You Know

“lego ergo scribo”

Dictator In Waiting

Have you had enough of Christie doing what he does best….covering his ass?  Then if you have I will give you a little info that may not have made it through the grapevine to your pc……

We all know, well most of us know, that the new head of the Fed is a woman named Yellin…..but did you know that there will also be a couple new vice chairs of the Fed (another name for dictator in waiting)?

Thanx to ABC News for the update…….

President Barack Obama intends to nominate Stanley Fischer, a former head of the Bank of Israel, to be vice chairman of the Federal Reserve, replacing Janet Yellen, who is ascending to the central bank’s chairmanship.

Fischer, a dual citizen of the United States and Israel, is considered a leading expert on monetary policy. He was a long-time professor at the Massachusetts Institute of Technology. Departing Fed Chairman Ben Bernanke was one of his students.

Not a big deal. right?  WRONG!

I do not think this person should be allowed to hold the position….why?  Simple…he holds dual citizenship and was the head of the Bank of Israel…..dual citizenship?  Pick one!  This should not be allowed.  Will he oversee policies that will effect Israel?  If so, will he be biased in their favor?

If you cannot have dual citizenship to be prez then it should be unacceptable to have it if you lead one of the most powerful entities in the world……personally, I think we ought to flush the Fed down the toilet but as long as we must have it then the people running it should be above reproach…….this guy cannot say that as long as he retains citizenship in another country…..

Thoughts?

They Are Printing Money!

Today’s subject is economics.  Hear That!  Thant sound is most people falling asleep and falling out of their chairs.

I know economics is not the most interesting thing to read about…..but before one can understand what is going on with our fiscal policy….one needs to understand economics….without understanding there is nothing but ignorance.

How many times have you heard the argument against the Fed….is that they are turning on the printing press?  How many times has the Fed been blamed for all the economic problems?

The accusation may be a metaphor but way too many seem to think that the Fed will just turn on the printing presses whenever we are in dire financial straits…..

What does it mean when they say the Federal Reserve is printing money? It doesn’t mean the Fed has a printing press that spouts out dollars. Only the Treasury Department does that. However, most of the “money,” or capital, in use today is not cash. That’s because the large financial institutions that do most investments prefer using borrowed money, or credit.

The Federal Reserve does manage the liquidity of capital, which is the amount that is available for investment. High liquidity means there is a lot of capital because interest rates are low, and capital is easily available. When credit is cheap, businesses and investors are more likely to borrow. The return on investment only has to be higher than the interest rate, so more investments look good. In this way, high liquidity spurs economic growth.

The Federal Reserve manages liquidity with monetary policy and the Fed funds rate. By lowering the Fed funds rate target, the Fed lowers all bank rates. This adds liquidity, which adds to the money supply. This has the same effect as printing money.

The Fed then “prints money” to spur borrowing, investing and economic growth.

I realize that I am nit-picking on this subject……but I like precise definitions…….. I just want people to grasp what is going on with our fiscal policy and to watch out for dog whistle slogans that explain nothing……..the Fed cannot actually print money!

Stop Screwing With The Economy!

If there is one thing that most Tea Partyers have in common….it is hate.  Not the hate of taxes (though some would argue)…..not even Obamacare……and the deficit is not on the list……the one thing that they all hate and want to make go away is…..(drum roll)……the Federal Reserve.

We all have our likes and dislikes but until such time as the Fed can be closed down or disbanded or ……well whatever….until that time we have to live with the fact that the Fed is in control of the money supply….as much as we may hate the fact….they are in control.

Every couple of weeks or months Mr. Bernanke must make the trip to Congress and do his thing….either testify or issue a report…and he recently issued such a report and what he had to say was very telling…..not that any of the clowns in the circus of Congress will heed his warnings…..but he made them the same……

(Newser) – The Federal Reserve isn’t planning to take its foot off the gas pedal anytime remotely soon, Ben Bernanke told Congress today, while rebuking legislators for not doing their own part to juice the economy. The Fed’s interest rate has been near zero since 2008, and Bernanke said he expects it to stay there for a “considerable time,” according to CNN Money. The Fed won’t ease up until unemployment drops to 6.5% or inflation passes 2.5%, and it doesn’t expect either to happen until 2015.

But he also criticized Washington’s recent economic moves, saying that the Fed didn’t “have the capacity to offset an economic headwind of this magnitude.” He cited the expiration of the payroll tax cut, other tax hikes and spending cuts (particularly defense spending), and the sequester as “a substantial drag on the economy.” Neil Irwin at the Washington Post translates the message to Congress thusly: “You’re the reason the economy isn’t taking off more.”

You may not like Bernanke but his words are accurate….Congress has done nothing to make our economy stronger….they have done nothing that would benefit the middle class……Congress wants to spend their limited time showboating at hearings that accomplish nothing but make for a spot ad in their next campaign.

Economists have been saying this same thing for 4 years….but NO one heeds the warnings or offers anything that would make our economy better…….hearings……37 votes to kill Obamacare……anything and everything except an economic solution……Repubs have spent 870 days without doing anything substantial, like offering bills, to fix the economy and create jobs…they even find bad news in the good news that the deficit will fall this year…..

You can hate the Fed but it is wasted effort…..why not hate Congress and then do something that will heal an ailing economy?  Like vote the douche bags out of office.  Or do nothing and bitch about stuff that you are too lazy to fix…..keep whining and watch the country crap out.  It is your choice.  Choose wisely.

Who Really Owns The US Debt?

it is election time and we hear from the Right about the evils of China….first, they are stealing American jobs…that is an oversimplification….the jobs are given away…not stolen….second, those Chinese devils own massive amounts of American debt….so in essence they are our creditors…….let us look at the debt thing before you go out and start believing the Mitt tale on China….

The recently released Federal Reserve Flow of Funds report for all of 2011 reveals that Federal Reserve purchases of Treasury debt mask reduced demand for U.S. sovereign obligations. Last year the Fed purchased a stunning 61% of the total net Treasury issuance, up from negligible amounts prior to the 2008 financial crisis. This not only creates the false appearance of limitless demand for U.S. debt but also blunts any sense of urgency to reduce supersized budget deficits.

It is true that the U.S. government has never been more dependent on financial markets to pay its bills. The net issuance of Treasury securities is now a whopping 8.6% of gross domestic product (GDP) on average per annum—more than double its pre-crisis historical peak. The net issuance of Treasury securities to cover budget deficits has typically been a mere 0.6% to 3.9% of GDP on average for each decade dating back to the 1950s.

But in recent years foreigners and the U.S. private sector have grown less willing to fund the U.S. government. As the nearby chart shows, foreign purchases of U.S. Treasury debt plunged to 1.9% of GDP in 2011 from nearly 6% of GDP in 2009. Similarly, the U.S. private sector—namely banks, mutual funds, corporations and individuals—have reduced their purchases of U.S. government debt to a scant 0.9% of GDP in 2011 from a peak of more than 6% in 2009.

The Fed is in effect subsidizing U.S. government spending and borrowing via expansion of its balance sheet and massive purchases of Treasury bonds. This keeps Treasury interest rates abnormally low, camouflaging the true size of the budget deficit. Similarly, the Fed is providing preferential credit to the U.S. government and covering a rapidly widening gap between Treasury’s need to borrow and a more limited willingness among market participants to supply Treasury with credit.

Read More…

Looks like all the chest thumping in the GOP ranks, at least at this election time, may be just another blowjob handed to the voter……please spend a little time checking the issues that will decide this election…please become an informed voter……..please help save this country from itself!

Whatever Do You Mean?

The Fed has been doing little things to try and keep the economy from bottoming out….like keeping interests rate near zero…thus making money more available to the innovators….but so far few have taken the bait…..but once a month there is all kinds of stories about what the Fed chair, Bernanke, is going to do to help the economy….

But there has been a turn of events…..it seems that some in Congress have taken it upon themselves to write a letter to Bernanke……

“[W]e submit that the board should resist further extraordinary intervention in the U.S. economy, particularly without a clear articulation of the goals of such a policy, direction for success, ample data proving a case for economic action and quantifiable benefits to the American people,” the Republicans write.Sens. Mitch McConnell (R-KY) and Jon Kyl (R-AZ), and House Speaker John Boehner (R-OH) and Majority Leader Eric Cantor (R-VA), ostentatiously cautioned Bernanke against providing the economy any further monetary stimulus.

Can Repubs be any more transparent?

Cool letter….but……According to the Board of Governors, the Federal Reserve is independent within government in that “its decisions do not have to be ratified by the President or anyone else in the executive or legislative branch of government.”

However the Fed is subject to congressional oversight but not interference.

But the letter seems to warn the Fed from doing anything that may help the economy…now is it a desire to try and use it as a political tool?  Or are they truly worried about something?  Personally. I think it is a pathetic attempt to keep the economy in the toilet for as long as possible.

Was Perry Right?

Recently Gov. Perry of Texas and presidential candidate accused Bernanke of treason or that his actions were treasonous…..many pundits condemn his statement as amateur swagger….that it was a rookie mistake on the first couple of days on the campaign trail…and as much as it pains me…..(pause here for grimacing)……he could be right.

What!  Prof. Chuq is siding with Perry?

Sorry, but Perry does have a point in his statement…..

The Federal Reserve is quietly continuing with one of the many outrageous bank-bailout programs it initiated during the financial crisis–the one in which it pays big banks interest on their “excess reserves.”

What are “excess reserves”?

Money that the banks have but aren’t lending out–money that banks are just keeping on deposit at the Fed.

The Fed is paying banks 0.25% interest on this money.

0.25% interest may not sound like much, but it’s more than the banks are paying you to keep money in your savings or money-market account. It’s also more than you’ll earn if you lend the Federal government money for 2 years.Why on earth is the Fed paying banks not to lend? Well, back in the financial crisis, the Fed wanted to find ways to secretly bail out the banks without it being screamingly obvious to every American that that was what it was doing. And this particular bailout program was one of the more successful ways it discovered of doing that. Over the past few years, this program has secretly funneled about $10 billion in risk-free cash (rough estimate) directly to the banks, just for being banks and not lending. Don’t you wish you could get in on that game?

The Fed pays banks about $4 billion of interest a year on that money–the money the banks aren’t lending. And bankers get big bonuses based on that interest, for being so smart as to not lend money and instead just take the free interest from the Fed.Source:BI

Read the entire piece at Business Insider and then say that you cannot understand the frustration that Perry may feel….personally, I think the Perry is an idiot and most likely never heard of the piece in BI….but beyond all that…..we are still being screwed by the Banksters and we are smiling all the time…..how smart are we?

But let me add……I think Prick….my bad……Rick Perry is an idiot…he is a self-serving little toad…Just so there is NO confusion of what I really think of this arrogant snake……if he wins the election in 2012,  I will look for property in Nova Scotia…….why?  All is lost for this country!