Bernanke Confirms: “If We Were To Tighten Policy, The Economy Would Tank”

Mac Slavo

Financial analysts have opined that the United States is well on the road to recovery. They cite various data points to make the case that the multi-trillion dollar bailouts and stimulus have brought us back from the brink of a collapse so serious that Congressional leaders had been told that should the bailouts fail, there was a real possibility of martial law being declared.

We’re doing so well, in fact, that just a couple of years ago President Obama assured the nation of our progress, claiming that we “reversed the recession, avoided a depression, [and] got the economy moving again.”

But were one to take a step back from the rhetoric of talking heads, political leaders and so-called Wall Street experts, a completely different picture begins to emerge.

Inflation Is Too Low? Are You Kidding Us Bernanke?

Michael Snyder

Federal Reserve Chairman Ben Bernanke said this week that inflation in the United States needs to be higher.  Yes, he actually came right out and said that.  It almost seems as if Bernanke is trying to purposely hurt the middle class.  On Wednesday, Bernanke told the press that "both sides of our mandate are saying we need to be more accommodative".  Of course he was referring to the Fed's dual mandate to keep unemployment and inflation low, but Bernanke has a very unique interpretation of that mandate.  According to Bernanke, inflation in the U.S. is now "too low".  The official inflation rate is currently sitting at about 1 percent, and Bernanke insists that such a low rate of inflation is not good for the economy.  He would prefer that the rate of inflation be up around 2 percent, and he is hoping that more "monetary accommodation" will help push inflation up and the unemployment rate down.

But what Bernanke will never admit is that the official inflation rate is a total sham.  The way that inflation is calculated has changed more than 20 times since 1978, and each time it has been changed the goal has been to make it appear to be lower than it actually is.

Farewell Bernanke – Thanks For Inflating The Biggest Bond Bubble The World Has Ever Seen

Michael Snyder

Federal Reserve Chairman Ben Bernanke is on the way out the door, but the consequences of the bond bubble that he has helped to create will stay with us for a very, very long time.  During Bernanke's tenure, interest rates on U.S. Treasuries have fallen to record lows.  This has enabled the U.S. government to pile up an extraordinary amount of debt. During his tenure we have also seen mortgage rates fall to record lows. All of this has helped to spur economic activity in the short-term, but what happens when interest rates start going back to normal?

If the average rate of interest on U.S. government debt rises to just 6 percent, the U.S. government will suddenly be paying out a trillion dollars a year just in interest on the national debt. And remember, there have been times in the past when the average rate of interest on U.S. government debt has been much higher than that. In addition, when the U.S. government starts having to pay more to borrow money so will everyone else. What will that do to home sales and car sales?

And of course we all remember what happened to adjustable rate mortgages when interest rates started to rise just prior to the last recession. We have gotten ourselves into a position where the U.S. economy simply cannot afford for interest rates to go up.  We have become addicted to the cheap money made available by a grossly distorted financial system, and we have Ben Bernanke to thank for that. The Federal Reserve is at the very heart of the economic problems that we are facing in America, and this time is certainly no exception.

QE3 Blowing Up the Debt Bubble

James Hall, Contributor

It begins . . . the latest downgrade of credit worthiness for the former titan reserve currency. As reality strikes, financial confidence goes negative. Forget the pump-and-dump equity markets, just how long will it be before the bondholders demand higher interest rates to cover their risk? Ben Shalom Bernanke answers this concern with intentions to keep rates near zero. Pure escapism out of the strange world of banksters’ hubris - faces the rating agencies. US Credit Rating Cut by Egan-Jones ... Again

Ratings firm Egan-Jones cut its credit rating on the U.S. government to 'AA-' from 'AA,' citing its opinion that quantitative easing from the Federal Reserve would hurt the U.S. economy and the country's credit quality. 

The Fed on Thursday said it would pump $40 billion into the U.S. economy each month until it saw a sustained upturn in the weak jobs market.

Step back and view the big historic picture. The lesson from the Roman Empire repeats with a vengeance . . .  in the era of digital bookkeeping.

How QE3 Will Make The Wealthy Even Wealthier While Causing Living Standards To Fall For The Rest Of Us

Michael Snyder, Contributor
Activist Post

The mainstream media is hailing QE3 as a great victory for the U.S. economy. On nearly every news broadcast, the "talking heads" are declaring that Ben Bernanke's decision to pump 40 billion dollars a month into our financial system is definitely going to help solve our economic problems. The money for QE3 is being created out of thin air and this round of quantitative easing is going to be "open-ended" which means that the Federal Reserve is going to keep doing it for as long as they feel like it. But is this really good for the average American on the street?

No way. 

Despite two previous rounds of quantitative easing, median household income has still fallen for four years in a row, the employment rate has not bounced back since the end of the last recession, and new home sales have remained near record lows. So what have the previous rounds of quantitative easing accomplished? 

Audit the Fed Threatens the Secrecy of the Federal Reserve Bank

Susanne Posel, Contributor
Activist Post

Senator Ron Paul, author of the legislation called Federal Reserve Transparency Act of 2012 (HR459) that will subject Ben Bernanke and the privately-owned Federal Reserve Bank to a monetary audit policy has seen much support from his peers on Capitol Hill. The House of Representatives passed 327 – 98 on a vote last week which exceeded the necessary 2/3rd majority.

Bernanke, trying to deter the US Congress from digging into the private matters of the Fed, told House lawmakers that this legislation would allow a “nightmare scenario” of political meddling in monetary policy making. How pretentious of this head of the global Elite banking cartel to say that American representatives would be fumbling idiots meandering about in the matters of private shareholders being forced to disclose their agendas regarding our money system.

Paul, who is pushing for “transparency” in America’s relationship with the Fed, said that Americans are “sick and tired of what happened in the bailout and where the wealthy got bailed out and the poor lost their jobs and they lost their homes.”

Peter Schiff Demolishes Panel at 'Economy Summit' (Video)

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The IMF joins Bernanke in threatening US legislators

The International Monetary Fund's Washington D.C. Headquarters

M. Ruppert, Contributing Writer
Activist Post

The debt ceiling issue is irrefutably a “hot button” issue that has Washington seemingly irreparably divided over smallbudget cuts that have little to no effect on the massive deficit. To make matters worse for the clowns in Washington arguing over tens of billions of dollars with a public debt realistically in the neighborhood of $100 trillion, the private Federal Reserve and the International Monetary Fund are now stoking the fire.

As the men and women of Capitol Hill bicker, Bernanke makes comments like, ”History makes clear that failure to put our fiscal house in order will erode the vitality of our economy, reduce the standard of living in the United States, and increase the risk of economic and financial instability.” While the IMF says that we need to raise our debt ceiling ”expeditiously to avoid a severe shock to the economy and world financial markets.”

A note about the above linked AP article addressing the IMF’s concerns: there is a massive typo that seemed to elude one of the world’s largest news organization’s entire editorial staff. The debt ceiling is not $14.3 billion, it is $14.3 trillion. This is no minor mistake as a trillion is a hefty 1,000 billion.

Anonymous: Bernanke Is Next -- June 14th (Video)

Editor's Note: Controlled opposition to justify a false flag ( Flag Day )  to bring down the Net due to "financial terrorism"? Or, just speaking the truth to legitimately expose the crimes of Ben Bernanke and the Federal Reserve Bank?

Courtney Comstock
Business Insider 

Anonymous has set its sights on Ben Bernanke.

The most well-known hacker group, Anonymous, uploaded a video message to youtube yesterday calling for Fed Reserve Chairman Ben Bernanke to resign, among other things. It's embedded below.

The video begins with Bernanke saying he is 100% confident of his ability to control the income disparity in the U.S. -- the largest of any industrialized country in the world -- on 60 Minutes.
Then it says:

"Democrats have failed us, Republicans have failed us... It is time for us to stand up for ourselves... We must fight back against the organized criminal class... We must launch "operation Empire State rebellion. The operation will commence on June 14th...Operation Empire State Rebellion Engaged."

Anonymous first called for Bernanke to resign on March 12.

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Bernanke sees 'loss of momentum' in jobs market

© AFP/Getty Images/File Scott Olson

AFP

WASHINGTON (AFP) - After a slew of wretched economic news, Federal Reserve Chairman Ben Bernanke has warned there had been a "loss of momentum" in the already tepid US jobs market.

Two years into a slow and largely jobless recovery, Bernanke predicted employment and growth would eventually pick up, but that a recent soft-patch needed to be carefully monitored and that stimulative policies were still needed.

"Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established," Bernanke told an audience in Atlanta, Georgia.

Fed sees 'transitory' higher inflation: minutes

Fed chairman Ben Bernanke
© AFP/Getty Images/File Alex Wong

AFP

WASHINGTON (AFP) - The US Federal Reserve still views higher inflation as only temporary as the economy muddles through a weak recovery from recession, the central bank reported Wednesday.

According to the minutes of the April 26-27 meeting of the policy-setting Federal Open Market Committee, the participants "generally anticipated that the higher level of overall inflation would be transitory."

While there had been "significant increases" in energy and other commodity prices that had boosted overall inflation, FOMC members expected price increases would ease once commodity prices stabilized.

We Are Change Confront Bankster Ben Bernanke (Video)

YouTube -- wearechange


Luke Rudkowski finally is able to get in the face of the master behind all this economic tyranny, Ben Bernanke. The short exchange proves how elites are scared to answer their ties to the treasonous Bilderberg group. If you never heard of the Bilderberg group please do your own homework and research and not just take our word for it.

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Celente: Bigger Than bin Laden – America’s New Public Enemy No.1

New Public Enemy #1

Gerald Celente
Lew Rockwell

From the fans at Citizens Bank Park in Philadelphia to the mobs at the White House gates, “USA, USA,” was the chant heard across the nation. Jubilant Americans celebrated the breaking news that Public Enemy No.1, terrorist mastermind Osama bin Laden was dead.

Ten years have passed since the Twin Towers toppled and the Pentagon was whacked. After two failing wars and billions of dollars spent on the global manhunt to bring in Bin Laden “Dead or Alive,” America has now claimed victory. “This is bigger than the moon landing, this is huge,” exclaimed Fox News’ Geraldo Rivera.

“Justice has been done,” intoned President Barack Obama announcing Bin Laden’s death. He not only called it “a good day for America,” but also declared that “The world is safer. It is a better place because of the death of Osama Bin Laden.”

The Fed's Ben Bernanke, de-mystified

"It used to be that the mystique of central banking was all about not letting anybody know what you were doing," he said. 


Translation:  It used to be that people were confounded (confused) by the FED, but now that more and more people are waking up to the truth about how the FED has destroyed the American dream, we better get out in front of this runaway train before it's too late.  Momentum is gathering amongst the American people to End the Fed!  The Creature from Jekyll Island may not survive the 'global political awakening'.

© AFP Jim Watson

AFP

WASHINGTON (AFP) - His voice cracked and pinched. When necessary -- most of the time -- he retreated into policy jargon.

With markets ready to pounce on any odd choice of words, US central bank chief Ben Bernanke was clearly nervous as he fielded reporters' questions after a policy meeting for the first time Wednesday.

And while the markets did react -- stocks jumped, the dollar dropped, and gold soared -- Bernanke probably succeeded in what he set out to do: putting a human face on the Federal Reserve while not making much news.

Wearing a checked red tie, looking appropriately professorial behind a broad wooden desk rather than Washington's more common power-stance -- the bearded, balding former Princeton economist said the Fed wanted to give more transparency and accountability. To give "color and context" to its data.

Fed chief to give historic press briefing

Billions if not trillions will hang on Bernanke
© AFP/Getty Images/File Jonathan Ernst

AFP

WASHINGTON (AFP) - The Federal Reserve's Ben Bernanke will give the central bank's first-ever post-meeting briefing on Wednesday, hoping to make a little -- but not too much -- Fed history.
In its 97 years the Federal Reserve has never answered questions after a meeting of its top policy-making panel.

That will all change on Wednesday at 14:15 in Washington (18:15 GMT), when chairman Ben Bernanke makes a brief statement and then takes questions from the press.

It is a seemingly small step, but is close to revolutionary for the ordinarily reserved bank -- with far-reaching implications for economic policy and the markets.

While Bernanke often comments on thorny and even politically charged topics, he usually does so via written statements, speeches delivered verbatim or carefully prepared congressional testimony.

Hedge Funds Speculators and Their Poverty Premium

SARTRE, Contributing Writer

Activist Post 

The short sale protection racket known as hedge funds is a speculators’ dream come true.

According to Investopedia, What Does Hedge Fund Mean? is defined as, 

An aggressively managed portfolio of investments that uses advanced investment strategies such as leveraged, long, short and derivative positions in both domestic and international markets with the goal of generating high returns (either in an absolute sense or over a specified market benchmark). Hedge funds use dozens of different strategies, so it isn't accurate to say that hedge funds just "hedge risk". In fact, because hedge fund managers make speculative investments, these funds can carry more risk than the overall market.

The public intuitively understands the practice of speculators. Gambling to make a quick buck is a simple concept. However, the use of esoteric financial instruments to squeeze out gains and shift risks onto the backs of other parties escapes most observers. Yet it smells of a stacked deck. 

Another Economic 'Martial Law in the Streets' Moment Approaches

Eric Blair
Activist Post

In the fall of 2008, during the lead up to the TARP bailout of the financial industry, Treasury Secretary Henry Paulson warned members of Congress that there will be Martial Law in America should they fail to pass the multi-trillion dollar looting of the taxpayer.

Well, despite the American public being overwhelmingly against the bailout, the blackmail worked and the banks got their money. If it worked once, why not try it again?

With the economy no better off for having borrowed trillions to "stabilize" criminal financial institutions, the national debt ceiling is rapidly approaching.  As some Republicans begin to float the notion of blocking this extension of credit, the Treasury Department, Democrats in Congress, and Ben Bernanke issued apocalyptic warnings clearly showing how pathetically fragile the U.S. economy is.

These threats, reminiscent of Paulson's 2008 ransom demands, once again appear to be offering two black-and-white choices: Armageddon or more debt.  The coordinated pitch for higher debt levels is echoing the same urgency as the TARP looting, as Treasury Secretary Geithner said the government is insolvent and will run out of money in about two months' time unless Congress votes to raise the federal debt ceiling.


The AFP reported Thursday that Senate Democrats warned that the government would "shut down" if the debt ceiling was not raised.  Chuck Schumer (D-NY) explained what that would mean if a shutdown were to occur: "citizens couldn't get their checks, veterans couldn't get their benefits, military payments would stop."

Ben Bernanke doubled down on the debt-fear campaign in a rare press conference where he said, "Beyond a certain point . . . the United States would be forced into a position of defaulting on its debt. And the implications of that on our financial system, our fiscal policy and our economy would be catastrophic."

Fiscal conservatives who oppose raising the debt ceiling say it is just delaying necessary belt-tightening and massive spending cuts, and say that raising the debt ceiling further only forestalls needed austerity moves to avoid a more catastrophic collapse in the future. House Republicans presented a plan to cut $32 billion from the budget, which is laughable given the impossible-to-pay-off debt levels.

The U.S. national debt is approaching the ceiling of $14.29 trillion; unfunded liabilities like Social Security and Medicare are estimated to be around $100 trillion; and the total cost of stabilizing the financial industry is reportedly upwards of $23.7 trillion.  And these numbers say nothing of the fraudulent $600-trillion derivatives scam. No amount of tax increases, spending cuts, or economic growth will be sufficient to satisfy this equation.

The notion that America can somehow pull itself out of this mess if average citizens, who had no part in creating the national debt, would only "tighten their belts," seems preposterous.

None of the options are exactly attractive to the already over-burdened taxpayer. Indeed, the people are being given a lose-lose-lose scenario: 1) the status quo of slow economic demolition through raising the debt ceiling; 2) crippling austerity cuts and public asset looting; or, 3) catastrophic collapse.

Although the banks and their pocket-change politicians describe market conditions that would result in a collapse should the ceiling not be raised, it seems obvious that the only power capable of drastically changing economic conditions are the banks themselves.  Therefore, market conditions appear to be an increasingly insignificant part of a bigger illusion.

As if the sun would not rise if a piece of legislation was not passed, the gun-to-the-head urgency will likely result in raising the debt ceiling.  If the level of resistance comes close to the near unanimous public disgust over the TARP bill, you can bet we'll hear new warnings of "martial law in the streets" in order to keep the illusion in tact.  If for some reason collapse is unavoidable, the U.S. military is actively war gaming "large scale economic breakdown" and "civil unrest" should they choose otherwise.

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Fed's Bernanke to give rare press conference

© AFP/Getty Images/File Alex Wong

AFP/Activist Post

WASHINGTON - The head of the US Federal Reserve will take questions from the press Thursday, a step that experts say is just short of revolutionary for the normally reserved central bank.

Instead of delivering an ever-so-carefully manicured speech and then slipping off the dais to the echo of gentle applause, Chairman Ben Bernanke will, unusually, hang around for a few questions from the press before departing.

It's a seemingly small step, but Bernanke knows any unscripted response he utters will be parsed, reported on and put to work by investors, with billions if not trillions of dollars at stake.

While Fed chairmen have occasionally given interviews and spoken to journalists off the record, formal press conferences by a sitting chairman are a rarity.


During the financial crisis Bernanke appeared with then-Treasury secretary Hank Paulson to explain how they proposed to rescue the US banking system, but by-and-large the Fed has stuck to carefully crafted speeches and meeting statements to get its point across.

But with the economy still shaky and most of the Fed's policy ammunition expended -- interest rates could not be lower and billions of dollars are being spent on stimulus -- Bernanke hopes to mold the economy in another way, wielding his influence through the press.

It is a radical change for an institution that just decades ago did not even inform the public about its interest rate decisions -- any central bank's main policy tool.

While a press conference is not the Fed's first choice, it is a necessary one, according to James Hamilton, an economics professor at the University of California and former Federal Reserve visiting scholar.

"It used to be that the Fed's main policy tool was to set interest rates. In that situation communication amounted to what that rate was going to be," he said.

But today, he added, "expectations of what the Fed is going to do next are a critical component of its policy and its ability to affect things."

"They are facing a new challenge with an old problem."

By simply adjusting expectations about future policies, growth, inflation, unemployment the Fed will hope to influence how the economy behaves in the future and how markets react.

As a top Fed policy panel recently put it, a "greater public understanding of the committee's interpretation of its statutory objectives could contribute to better macroeconomic outcomes."

Bernanke will also hope to avoid a repeat of the recent reaction to his $600-billion plan to prime the economy, which was condemned by some as unnecessary even as the Fed struggled to convey that it thought growth and inflation were too low.

A press conference is needed to improve the Fed's standing after anger at bank bailouts, according to Mark Calabria, a former Senate staffer now with the Cato Institute, a libertarian think thank.

"A lot of this is geared at trying to rebuild the public perception of the Fed," he said, citing the damage done by the Fed's recent involvement in hot button political issues.

But for Bernanke, the pitfalls are many and varied.

For years he has watched -- perhaps with just the slightest hint of schadenfreude -- as his Japanese and European counterparts struggled to navigate regular press conferences without prompting a market meltdown.

"There is a risk that you say things a little spontaneously, and that is never what you want from the central bank," said Hamilton.

If history is anything to go by, Bernanke could just as easily trip up by misjudging the sporting affiliations of the press pack as answering the question of an attractive Wall Street journalist in too direct a way.

His European Central Bank counterpart Jean-Claude Trichet was once heckled at a press conference in Germany for mentioning the national team's soccer World Cup defeat at the hands of Spain the night before.

Bernanke himself once admitted to a "lapse in judgement" after commenting very directly about interest rates after a female newsreader's dinner question.

He will be hoping for no similar lapses of judgement on Thursday, or risk damaging the Fed's credibility.

"The Fed, under the enlightened leadership of Ben Bernanke, is rapidly losing its credibility," warned Ed Yardeni of Yardeni Research.
© AFP

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CBS 60 Minutes Finally Gets One Right

Editor's Note:  Why does CBS finally get one right?  Because the masses must now be prepared for "Austerity" measures which are deliberately designed to erase the middle class and destroy the masses.  None of this is happening by mistake.  The International Banking elites have a survival plan, but it does not include you!

Greg Hunter
USA Watchdog

I have been pretty hard on “CBS  Minutes” for doing fluff interviews with Fed Chief  Ben Bernanke and not asking the hard questions that would be obvious to a freshman journalism student.  In all fairness, I have to admit last Sunday’s story called“The Day of Reckoning” was an eye opening, hard hitting piece. It was about the dire financial troubles that are overwhelming many state budgets.  My only criticism–“60 Minutes” is a little late coming to the party.   But as that old cliche goes, “better late than never.”

Since this website was launched nearly a year and a half ago, USAWatchdog.com has mentioned many times the dire financial situation many states face.  California alone is $19 billion in the hole, and Illinois is basically a deadbeat when it comes to paying its bills.  CBS broke some new ground with this story.

Banking analyst Meredith Whitney predicted as many as 100 “sizeable” municipal bond defaults in 2011!   It is one thing to read a great quote, it is quite another to see some one’s face when they say it.

Facial expressions say much more than words can ever capture.  Take, for example, Ben Bernanke’s quivering lips when he said that it was a “myth” the Fed was “printing money”–priceless! Please enjoy the 60 Minutes story below that went out of its way to NOT sugar-coat the truth.

SEE VIDEO

RELATED ARTICLE:
More on CBS, Ben Bernanke, and The New Tax Law 


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