Day of reckoning won't wait 4 years!

MONDAY, NOVEMBER 12, 2012 Day of reckoning won't wait for 4 years By MARK STEYN Syndicated columnist letters@ocregister.com Amid the ruin and rubble of the grey morning after, it may seem in poor taste to do anything so vulgar as plug the new and stunningly topical paperback edition of my book, "After America" – or, as Dennis Miller retitled it on the radio the other day, "Wednesday." But the business of America is business, as Calvin Coolidge said long ago in an alternative universe, and I certainly could use a little. So I'm going to be vulgar and plug away. The central question of "Wednesday" – I mean, "After America" – is whether the Brokest Nation In History is capable of meaningful course correction. On Tuesday, the American people answered that question. The rest of the world will make its dispositions accordingly. In the weeks ahead, Democrats and Republicans will reach a triumphant "bipartisan" deal to avert the "fiscal cliff" through some artful bookkeeping mechanism that postpones Taxmageddon for another year, or six months, or three, when they can reach yet another triumphant deal to postpone it yet again. Harry Reid has already announced that he wants to raise the debt ceiling – or, more accurately, lower the debt abyss – by $2.4 trillion before the end of the year, and no doubt we can look forward to a spectacular "bipartisan" agreement on that, too. It took the government of the United States two centuries to rack up its first trillion dollars in debt. Now Washington piles on another trillion every nine months. Forward! President Barack Obama delivers a statement about the action to keep the economy growing and to reduce the deficit in the East Room of the White House on Nov. 9. MCT PHOTO ADVERTISEMENT POLITICAL CARTOONS: 45 cartoons on the fiscal cliff, FORWARD! for Obama, GOP reactions and more If you add up the total debt – state, local, the works – every man, woman, and child in this country owes 200 grand (which is rather more than the average Greek does). Every American family owes about three-quarters of a million bucks, or about the budget deficit of Lichtenstein, which has the highest GDP per capita in the world. Which means that HRH Prince Hans-Adam II can afford it rather more easily than Bud and Cindy at 27b Elm Street. In 2009, the Democrats became the first government in the history of the planet to establish annual trillion-dollar deficits as a permanent feature of life. Before the end of Obama's second term, the federal debt alone will hit $20 trillion. That ought to have been the central fact of this election – that Americans are the brokest brokey-broke losers who ever lived, and it's time to do something about it. My Hillsdale College comrade Paul Rahe, while accepting much of my thesis, thought that, as an effete milquetoast pantywaist sissified foreigner, I had missed a vital distinction. As he saw it, you can take the boy out of Canada but you can't take the Canada out of the boy. I had failed to appreciate that Americans were not Euro-Canadians, and would not go gently into the statist night. But, as I note in my book, "a determined state can change the character of a people in the space of a generation or two." Tuesday's results demonstrate that, as a whole, the American electorate is trending very Euro-Canadian. True, you still have butch T-shirts – "Don't Tread On Me," "These Colors Don't Run"... In my own state, where the Democrats ran the board on Election Night, the "Live Free Or Die" license plates look very nice when you see them all lined up in the parking lot of the Social Security office. But, in their view of the state and its largesse, there's nothing very exceptional about Americans, except that they're the last to get with the program. Barack Obama ran well to the left of Bill Clinton and John Kerry, and has been rewarded for it both by his party's victory and by the reflex urgings of the usual GOP experts that the Republican Party needs to "moderate" its brand. I have no interest in the traditional straw clutching – oh, it was the weak candidate... hard to knock off an incumbent... next time we'll have a better GOTV operation in Colorado... I'm always struck, if one chances to be with a GOP insider when a new poll rolls off the wire, that their first reaction is to query whether it's of "likely" voters or merely "registered" voters. As the consultant class knows, registered voters skew more Democrat than likely voters, and polls of "all adults" skew more Democrat still. Hence the preoccupation with turnout models. In other words, if America had compulsory voting as Australia does, the Republicans would lose every time. In Oz, there's no turnout model, because everyone turns out. The turnout-model obsession is an implicit acknowledgment of an awkward truth – that, outside the voting booth, the default setting of American society is ever more liberal and statist. The short version of electoral cycles is as follows: the low-turnout midterms are fought in political terms, and thus Republicans do well and sometimes spectacularly well (1994, 2010); the higher-turnout presidential elections are fought in broader cultural terms, and Republicans do poorly, because they've ceded most of the cultural space to the other side. What's more likely to determine the course of your nation's destiny? A narrow focus on robocalls in selected Florida and New Hampshire counties every other fall? Or determining how all the great questions are framed from the classroom to the iPod to the movie screen in the 729 days between elections? The good news is that reality (to use a quaint expression) doesn't need to swing a couple of thousand soccer moms in northern Virginia. Reality doesn't need to crack 270 in the Electoral College. Reality can get 1.3 percent of the popular vote and still trump everything else. In the course of his first term, Obama increased the federal debt by just shy of $6 trillion and, in return, grew the economy by $905 billion. So, as Lance Roberts at Street Talk Live pointed out, in order to generate every $1 of economic growth the United States had to borrow about $5.60. There's no one out there on the planet – whether it's "the rich" or the Chinese – who can afford to carry on bankrolling that rate of return. According to one CBO analysis, US government spending is sustainable as long as the rest of the world is prepared to sink 19 percent of its GDP into U.S. Treasury debt. We already know the answer to that: In order to avoid the public humiliation of a failed bond auction, the U.S. Treasury sells 70 percent of the debt it issues to the Federal Reserve – which is to say the left hand of the U.S. government is borrowing money from the right hand of the U.S. government. It's government as a Nigerian email scam, with Ben Bernanke playing the role of the dictator's widow with $4 trillion under her bed that she's willing to wire to Timmy Geithner as soon as he sends her his bank account details. If that's all a bit too technical, here's the gist: There's nothing holding the joint up. So, Washington cannot be saved from itself. For the moment, tend to your state, and county, town and school district, and demonstrate the virtues of responsible self-government at the local level. Americans as a whole have joined the rest of the Western world in voting themselves a lifestyle they are not willing to earn. The longer any course correction is postponed the more convulsive it will be. Alas, on Tuesday, the electorate opted to defer it for another four years. I doubt they'll get that long. ©MARK STEYN FOLLOW US @OCRegLetters WRITE A LETTER TO THE EDITOR Letters to the Editor: E-mail to letters@ocregister.com. Please provide your name, city and telephone number (telephone numbers will not be published). Letters of about 200 words or videos of 30-seconds each will be given preference. Letters will be edited for length, grammar and clarity. More from National Columnists »   COMMENTS | PRINT | EMAIL |   SHARE Reader Comments Comments are encouraged, but you must follow our User Agreement. 1. Keep it civil and stay on topic. 2. No profanity, vulgarity, racial slurs or personal attacks. 3. People who harass others or joke about tragedies will be blocked. View Article Posted by keeptheshuttleflying.com at 4:21 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook Ben Bernanke bailing out Obama—Charles Gasparino - NYPOST.com http://www.nypost.com/p/news/opinion/opedcolumnists/bernanke_bad_news_fUiLLK5oa6jH1osPvrkWjL Sent from my iPad Posted by keeptheshuttleflying.com at 4:03 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook Bank bail out money Best Answer - Chosen by Asker 750 billion and most of it went to foreign countries governments and foreign banks. 4 years ago Report Abuse Asker's Rating:Asker's Comment: that's sad...there's not even an appearance of accountability Posted by keeptheshuttleflying.com at 2:20 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook A Doctor's take on give me man reelection   To: ; Subject: your health care Date: Mon, 12 Nov 2012 12:54:12 -0600 What Obama's victory means for your health care -- a doctor's take By Dr. Marc Siegel Published November 07, 2012 June 28, 2012: Supporters of President Barack Obama's health care law celebrate outside the Supreme Court in Washington. (AP) Tuesday night's win in the presidential contest for President Obama was a win for ObamaCare, the president's signature legislation from his first term. ObamaCare will now continue to be implemented. This future means that we will continue to be faced with rising insurance premiums, as our current insurance expands to cover all patients regardless of pre-existing condition, age, or how many times they've already used the policy.  Insurance will continue to follow a one-size-fits all model, where it is easy to overuse but may not cover our latest expensive technology which offer more personalized solutions.  Federal regulations in the form of Medicare's Independent Payment Advisory Board as well as ObamaCare's many other committees will restrict my choices for my patients. I will have more patients with more red tape and less time to spend with them.  Since ObamaCare does not effectively address the doctor shortage, you will see more nurse practitioners and physicians assistants, who are quite competent, but have different training than I have treating patients.  My patients who gain a new insurance card may find that it doesn't buy them the care they were expecting. - Medical care will be shifted more and more to the hospital and medical center, which are more equipped to preserve their bottom line profits despite increasing federal regulations.  Accountable Care Organizations under the Affordable Care Act will focus more on quality of care as opposed to fee for service, which large groups and medical centers are more equipped to implement.  Doctors will cherry-pick their patients, staying away from those who are too sick to allow them to apply for financial incentives. ObamaCare can only afford to extend health insurance entitlements to more people through increased taxes or penalties (payroll tax for Medicare, individual and business mandates, tax on medical devices, etc.).  If the current economic climate continues, small businesses will be reluctant to add more employees and large businesses will prefer to pay the ObamaCare penalty than pay the increasing premiums.  More and more people will get their health insurances at the state exchanges, where taxes pay for federal stipends in states which have created their own exchanges.  There will be a disparity of services provided depending on your state. Medicaid expansion offered to 16 million more people will also vary depending on whether your state can afford to implement it or not. Medicaid lacks sufficient providers or networks to provide care, and the expansion makes this problem far worse. President Obama's victory on election night is not a victory for health care, though it may be a narrow one for health insurance companies who gain more customers.  Prices will continue to rise and access to actual care will decline in an already overcrowded system.  Biotech companies and drug companies may feel that the climate is no longer ripe for innovation. Hospitals and other health care providers will continue to struggle amid shrinking reimbursements.  Bottom line: my patients who gain a new insurance card may find that it doesn't buy them the care they were expecting. Marc Siegel MD is an associate professor of medicine and medical director of Doctor Radio at NYU Langone Medical Center. He is a member of the Fox News Medical A Team and author of The Inner Pulse: Unlocking the Secret Code of Sickness and Health.   Posted by keeptheshuttleflying.com at 1:47 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook Economic solutions Major Economic Concerns Facing the United States The United States is facing economic disaster on a scale few nations have ever experienced. Most people are unaware of the easily observable signs of this emerging crisis. While we persist in our superpower mentality, we have quietly become a second-class country in many respects. We no longer manufacture what we need to sustain ourselves, we import much more than we export, and we are selling off our assets and taking on massive debts to sustain a standard of living we can no longer afford. Not only is this not the way America became a superpower but it is a sure way to lose this status. We are failing even to acknowledge predatory foreign trade practices undermining US industry. Instead we encourage US manufacturers to design, engineer, and produce in third world markets like Mexico and China. Reversing the Trend: Some Suggestions for Action Access to our markets must be conditioned on a strategic analysis of our own national needs first and foremost. As things stand, we have handed our sovereign rights to our domestic markets to international bodies like the World Trade Organization and are committed to disastrous “one-way free trade” agreements such as Value Added Tax regulations and NAFTA. We are in a dramatically different position from emerging low-wage markets. They have everything to gain, and we have everything to lose. Our policies should carefully protect our wealth and resources rather than simply provide the lowest consumer cost regardless of the impact on our industries and our workers. Promoting open markets and economic growth abroad will not alone rebalance America’s trade accounts and domestic industrial collapse. Our industries have been so disarmed and dismantled that we now lack the knowledge, capacity, and investment capital to facilitate self-sustaining production. Dramatic new direction is required. Key Solutions Drastic action is needed to restore our economic and financial independence and we must begin immediately to rebuild our industries. The first essential is that our government should ensure that it is once again profitable to produce most goods and services in American factories employing American workers. We must establish policies that prevent other countries from doing to us what they would never let us do to them. Specifically, We must halt the sale of key assets to foreign entities. We must also close opportunities for foreign corporations to compete unfairly against our home industries. We should move immediately to curb our out-of-control spending on unnecessary programs and initiatives that are being financed by foreign debt. We should institute policies to cut back our consumption, and particularly consumption of imported products. We should look to the way other nations have established industrial superiority over us and try to copy their best policies. We should not allow individuals and companies to profit by selling out the Unites States. No plan to revive our economic and industrial self-sufficiency will be pain-free. Because our industrial decline has already gone so far – it has been proceeding rapidly for more than 30 years already – restoring our industry to world-leading standards of competitiveness will require serious restrictions on trade and investment flows. Despite indisputable evidence that current policies have proved grossly inadequate or even counterproductive in the past, our leaders remain committed to a business-as-usual strategy that is doomed to failure. The stimulation for new policies must come directly from the broad American public. Voters must use all reasonable methods to pressure elected officials. Without direct and immediate action, there will soon be little left to save. Defense Our industries, assets, resources, and companies need to be protected from foreign countries and corporations seeking to gain control of key industrial processes and technologies. This would include preventing the sale of strategic US domestic companies to foreign companies and eliminating offshore outsourcing except in extreme circumstances. Fair Trade Our trade treaties should protect our country from predatory foreign countries and companies seeking to weaken or destroy American industry. To that end, tariffs should be erected where needed and where practical. Experience has shown that it is futile to expect other countries to adopt our policies on, for instance, fair and free competition. What we can do is control the impact of their policies on our economy. The most obvious tool we have is tariffs on their exports. No doubt our tariffs would set off retaliation abroad. We would also have to accept that demand for US debt would decrease. But in the long run, these negatives would be much more than offset by positive effects as American entrepreneurs and industrial executives enjoyed a massive incentive to renew our industrial base. Domestic Industry Competitiveness In addition to establishing protection for our industry and country, we should properly align our companies with the national interest by changing the incentive system within which they operate. The tax structure should be changed to encourage industrial revival, particularly in industries which have been hit worst by unfair foreign competition. One simple but highly effective measure would be to shorten the depreciation schedules on capital investment and research spending. Meanwhile capital gains taxes should be increased to discourage short-term thinking and reduce the incentive for entrepreneurs to cash out. Suggested Solutions to America’s Economic Problems The following suggestions should be considered as part of a new plan to recover American industry and economic health: • Appoint an economic minister, a major cabinet post, to develop an industrial policy that would: 1. Create conditions to make manufacturing competitive and profitable through tax changes and subsidies where needed 2. Protect our economy from foreign predatory practices 3. Create an industrial research and development division similar to government sponsored National Institute of Health (NIH) in medicine or the Apollo project. Or, copy Japan’s very successful system conducted by their Ministry of International Trade & Industry (MITI) that focuses on needs and development procedures for their new and existing industries. • Change the tax structure for select industries that are vital to strategic American interests – steel, transportation, cement and others. • Control the balance of trade deficit. The majority of this money leaves our economy and never returns. The money that does return is the means through which foreign companies are able to accumulate funds to purchase our best companies. • Amend or get out of our agreement with the WTO. It places our domestic trade laws in the hands of an undemocratic organization whose decisions have been consistently and unfairly adjudicated. • Eliminate the foreign Value Added Tax (VAT) discrepancy. It unjustifiably subsidizes foreign exports to us, while simultaneously penalizing our exports to them. • Amend or get out of NAFTA. It incentivizes our companies to move productive facilities out of our country. • We must analyze every international trade deal by considering if it benefits America; currently most deals do not. • Use tariffs selectively to prevent the loss of strategic and endangered industries. • Curtail subsidies foreign owned companies receive from state governments and discourage technology transfer and outsourcing manufacturing that results in the loss of industries. • Prevent the sale of strategic companies or institutions to foreign ownership. • Faster depreciation on capital equipment investment – it will lessen the need to outsource manufacturing. Free trade has been a disaster. It must be replaced with intelligent trade that prevents foreign predatory practices and better serves U.S. interests. OTHER THINGS TO CONSIDER: • We must strive to become competitive; otherwise America must exist on imports with more debt, • American owned companies have lost their edge and, on balance, are not as productive or as protective as many other foreign companies. This must be corrected. • It must be profitable to manufacture in America otherwise domestic companies will outsource their manufacturing. • America is losing a major economics war by relinquishing management and control of the economy through effects of our balance of trade deficit, outsourcing, subsidized insourcing and foreign tax benefits. • Consider the consequences of losing whole industries such as publishing, autos, movies, steel, electronics, clothing and how it impacts national security and living standards. • We need to analyze and correct: 1. Negative effects of WTO rules and decisions regarding their impact on our economy. 2. Violations of WTO rules practiced by other countries to our detriment 3. Restrictions imposed by foreign governments on American exporting companies. Print PDF Posted by keeptheshuttleflying.com at 1:41 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook Doesn't take a " brain" to understand, somebody must produce something! The give me people should be able to understand the stuff they get isn't free. Some day the chickens will come home to roost, or the piper must be paid. If printing money at will isn't rectified, we will all pay dearly!!! Posted by keeptheshuttleflying.com at 1:30 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook It won't work---somebody must produce something! Charles Kadlec, Contributor I cover economic/political issues with liberty as my polar star. Follow (75) OP/ED | 9/14/2012 @ 10:20AM |13,842 views The Fed's Futile Effort To Bail Out Obamanomics 46 comments, 3 called-out + Comment now see photos Click for full photo gallery: Election 2012: The Decision For Investors In what can be viewed as a desperate effort to bail out the failed economic policies of the Obama Administration, the Federal Reserve this week committed to purchasing $40 billion a month of mortgage backed securities for an unlimited time and to keep interest rates artificially low until at least mid 2015.  By so doing, the Fed has embarked upon a course that invites higher inflation, falling living standards, and a global financial crisis. The Federal Open Market Committee’s (FOMC) official statement, released Thursday after the conclusion of its meeting, pays lip service to price stability, which it defines as an increase in the price level of 2% a year, or a 33% devaluation of the dollar over the next 20 years. However, the Fed also left little doubt that for the foreseeable future, it will print money in an effort “to support a stronger economic recovery.” In Their Own Words: The Essence Of The Republican National Convention Charles Kadlec Contributor The Top Ten Reasons That You Should Support the "Gold Commission" Charles Kadlec Contributor Mitt Romney Paid 30%, Not 13% In Federal Income Taxes Charles Kadlec Contributor President Obama's Smashing Success Story: Greatly Increasing The Power Of Government Charles Kadlec Contributor The fundamental problem is the Fed’s policy stance is internally incoherent.  Stabilizing the value of the dollar would require the Fed to provide as much, or as little, money as the world demands at a stable price level.  In other words, price stability requires the quantity of money to be the variable. However, the Fed has chosen the opposite policy.  Now, the quantity of money will increase at a fixed, $40 billion a month, which, by necessity means any change in the demand for dollars that does not precisely match the increase in the dollar’s supply will produce a change in the price of the dollar. In other words, the Fed’s new policy will lead to unstable prices. The most likely direction of instability will be higher inflation.  First, the Fed is increasing the supply of money relative to the demand for dollars in an explicit effort to lower interest rates and spur consumption.  Too much money relative to the demand for money cheapens the dollar and leads to higher prices. Second, this process feeds on itself.  By increasing the risk of inflation, the Fed’s policy has made holding dollars more risky which produces a fall in the demand for dollars  – individuals and businesses alike seek to avoid holding any asset whose value is in decline.  A fall in the demand for dollars in the face of rising supply adds fuel to inflationary pressures. This process has started already.  In his remarks at the Federal Reserve Bank of Kansas City Economic Symposium in Jackson Hole, Wyoming on August 31, Fed Chairman Ben Bernanke signaled the Fed was likely to decide on another round of quantitative easing at the FOMC meeting just ended. Between August 30 and Tuesday, the value of the dollar in terms of gold fell 4.5%.  It then fell an additional 2.2% on Thursday, the day the Fed announced its next round of quantitative easing. Over that entire period, the dollar also fell 3.7% against the struggling euro, and the price of oil rose nearly 5%. Price changes of this magnitude in so short a time point directly to a fall in the demand for dollars and higher inflation in the months ahead.  Only a shock to the global financial system which would increase the demand for dollars by triggering a flight into the dollar can reverse these inflationary pressures. Although the risks of inflation are all too real, the supposed benefits of the Fed printing money and keeping interest rates low are highly questionable.  A just published Federal Reserve Bank of Dallas working paper by William R. White, entitled:   “Ultra Easy Monetary Policy and the Law of Unintended Consequences” concludes the negative consequences of the sort of quantitative easing the Fed has just embraced will likely outweigh any short term benefits: “…the capacity of such (ultra easy) policies to stimulate ‘strong, sustainable and balanced growth’ in the global economy is limited.  Moreover, ultra easy monetary policies have a wide variety of undesirable medium term effects – the unintended consequences.  They create malinvestments in the real economy, threaten the health of financial institutions and the functioning of financial markets, constrain the ‘independent’ pursuit of price stability by central banks, encourage governments to refrain from confronting sovereign debt problems in a timely way, and redistribute income and wealth in a highly regressive fashion.  While each  medium term effect on its own might be questioned, considered all together they support strongly the proposition that aggressive monetary easing in economic downturns is not a ‘free lunch’.” Of course, we have been suffering just these consequences from a too-easy Fed for the past dozen years.  Since 1999, the Fed, first under Alan Greenspan, and then under Ben Bernanke, sought to manage the U.S. economy by manipulating interest rates and the value of the dollar.  In addition, Presidents George W. Bush and Barack Obama have pursued a weak dollar policy in hopes it would stimulate job creation in the U.S. Instead, easy money and the weak dollar have crushed the middle-class with more than a decade of below average growth and falling living standards.  Since 1999, the dollar has been devalued more than 80% against gold.  Economic growth has averaged a paltry 1.7% a year – the worst 12 years since the 1930s.  The Fed’s easy money policies during the middle of the decade contributed directly to speculative bubble in real estate and the financial crisis of 2008.  And this week, the Census Bureau reported real median household income in 2011 fell for the fourth consecutive year in a row, and is now down 8.9% from where it stood in 1999. Expect more of the same from the Fed’s latest pursuit of the hubris of central planning over its vital role of providing domestic and international markets with a strong and stable dollar.  The run-up in the price of gold and oil in just two weeks indicates any short-term increase in demand will be offset quickly by higher prices and falling real wages and profits.  The rush into gold, which provides no economic benefit other than to protect its holder against bad monetary policy, also indicates the malinvestments have already begun. The yield on the 10-year Treasury bond has begun to creep up.  And, the rush to hedge against the debauchery of the dollar sets the stage for the next bubble and plants the seeds of the next financial crisis. Chairman of Federal Reserve Board Ben Bernanke (Image credit: Getty Images via @daylife) What is missing is a robust debate over monetary policy in the Presidential campaign.  President Obama through his silence implicitly endorses the Fed’s move in hopes it will somehow bail out the economy from his administration’s failed economic policies. Republican Presidential Nominee Mitt Romney criticized the Fed’s move as evidence that the economy is not improving, but he has yet to offer a hard dollar alternative to the failed soft dollar of the past dozen years. The Republican platform calling for a gold commission now appears prescient.  The time is past due to restore a rules based monetary policy that will guarantee the value of the dollar and insure the independence of the Fed.  The question is: does Governor Romney have the wisdom and courage to embrace monetary reform as a central plank in his own bid for the Oval Office. 46 comments, 3 called-out + Comment now Print Report Corrections Reprints & Permissions  by Taboola From The Web Controversial Video Spreads Virally After Being Banned Moneynews 50 Bad Athletes Who Made Most Money Bleacher Report The Death of Stainless is Here Reviewed.com Storage Wars: The Inside Scoop AETV Shocking discovery for joint relief Direct Digital What to Do if You're Suspicious of Your Partner TalkTala - Youtube Post Your Comment Please log in or sign up to comment. Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out. Comments CALLED-OUT Expand All Comments + expand comment Eric Oswald 1 month ago Shouldn’t the headline read “The Fed’s Futile Effort To Bail Out The Economy Stymied By GOP Obstructionism in Congress”? Reply + expand 9 comments Armand Winter 1 month ago Obama proposed a $4 Trillion debt reduction plan that would have kept S&P from downgrading us, eliminated the need of the Super Committe, which was ultimately sabotaged by the Republicans resulting in automatic cuts to defense spending… back in April of 2011. Instead Boehner, Cantor, McConnell, Norquist and the GOP decided to protect Mitt Romney’s 15% tax rate. 1) Why can’t Romney pay his fair share in taxes? 2) Why do you want Norquist and his Palestinian wife who gives money to terrorists, running this country? – Look it up on wikipedia 3) How does this help job creation? Reply Usiku A 1 month ago Good point on the debt reduction plan being interfered with. For similar points of evidence, see “President Obama, One Out Of Four.” Reply Joshua Pabelick 1 month ago Are you serious Armand look at wiki as a reference? You do realize that is a user based system anyone can alter right? the better question is why support a man who has not passed anything other than a failed stimulus bill and the failed ACA (which mind you he lied about the entire time). No the problem is not Bush it is not republicans it is simply that we have an ignorant president. Where is our budget, where is his jobs bill, since when do we need countries to prod us over help, since when is living off unemployment and goverment benefits acceptable? This president has failed in every aspect of his job and has done so all the while he bought votes from latinos, lgb people and african americans. The only reason his numbers are even on par with Mitt’s is thanks to those he panders to. It’s funny there was just an article basically asking why obummer has a hard time connecting with white middles class americans but really the answer is simple, It’s because obummer has placed the burden of his future on us while giving handouts to minorities. 1 Why did obama pay less taxes then those in his office 2. Why do you want a president who gave money to GM who in-turn outsourced millions of jobs tell you he things things are ok in this sector and getting better in that sector. 3. How does laughing it up in talk shows, celeb diners, award shows, sporting events, golf outings, frequent vacations improve the economy Reply Chuck Kreuzer 1 month ago Blame the GOP… Typical. You mean that same GOP that wrote all the legislation Clinton signed and gave us a decent economy and a surplus? You mean the same GOP that kept out debt in control? You mean the same GOP that has averaged 5.0% unemployment for the last 32 years when in control of congress? Obama’s “government trickle down economics” have given us 23M unemployed and $16T of debt. If he’s re-elected, that debt is estimated to grow to $24T by 2016 (CBO estimate). that will be about 140% of our GDP. That’s a certain path to Greece. But, that’s what you people elected – a completely inexperienced and uneducated amateur to run this country. Yet you expected him to be an expert. Quite the mistake. I hope you never get into the position of hiring people for your company. Reply Usiku A 1 month ago Speaking of the “bigotry” you accused Armand Winter of, how can you call Obama uneducated when he went to Harvard? Is it because when you “look” at him, that it is your core bias you see which overrides evidence to the contrary? Reply Will Barkley 1 month ago This is the result from a failed stimulus by a President’s failed policies. He had 2 and a half years of a democratic house and senate. Quit blaming GOP and Bush for Obama’s shortcomings.. Reply 18mc 1 month ago Obama wouldn’t make any budget cuts = ZERO deficit reduction. His $4 trillion reduction plan was rejected by BOTH senate democrats & republicans. Because it was a terrible plan. Obama is all talk. That’s what I’ve learned since last election. Reply Charles Murdoch 1 month ago I love it when republicans dismiss who was in the White House during good times and give all the credit to a republican-controlled legislature. So, I guess you’ll be voting for Obama since it doesn’t matter who’s in the White House, right? Reply ps61penn62prin64 1 month ago The Federal Reserve is bailing out the failing Federal Reserve System. With the exception of government issued coins, all the currency in the U.S. economy is created as the principal of loans originated by the Federal Reserve System. When people repay these loans, the money the system created is expunged from the economy. So reserve currencies are inherently unstable. Since banks are not lending, and people continue to pay off their loans, the money supply is contracting, binding the economy and restricting commerce. Privatized reserve currency systems do not work. In modern western economies, privatized currencies are at the heart of the economic mess in everyone. Historically, privatized currencies have a consistent record of economic failures. They are, perhaps, the single most important cause of poverty and the most serious threat to civil rights in the world today. Reply + expand 2 comments chanhol 1 month ago Someone who has been paying attention might summarize “Obama’s economic policy” as “trying to pick up all the pieces”. Thus, being opposed to the Fed trying to bail out “Obama’s failed attempt to pick up all the pieces” leaves us where? Going back to create more pieces? Reply Armand Winter 1 month ago Romney has vowed to fire Bernanke and replace him with a Mormon. Reply + expand comment Chuck Kreuzer 1 month ago What’s your point? Are Mormons somehow unqualified because of their religion? Why don’t you just come out and say what what you really mean, instead of attempting to hide your bigotry. Reply + expand comment John Harllee 1 month ago Obama’s failed economic policies. For ordinary Americans, to some extent. For Forbes readers? Hardly. The S&P 500 is up about 70% since Obama took office. If that’s failure, I want lots more. Reply + expand comment Matt 1 month ago This should really keep liberals up at night questioning their policies. If they really want to help the poor and middle class, they should be infuriated by the premise that they’re failing, which is causing the Fed to pursue policies that are disproportionately benefiting the wealthy (equity prices are up, mortgage refi’s for the wealthy are cheap, etc.). Instead, they’re pointing the the S&P 500 level as an argument in favor of more Obamanomics. It’s crazy. Reply + expand 5 comments Armand Winter 1 month ago Norquist’s wife is a Palestinian Muslim that gives money to terrorists. Norquist, with his wife, Samah Alrayyes, born Muslim, founded the Islamic Free Market Institute which shares office space in Washington , D.C. with Norquist’s lobbying firm Americans for Tax Reform. The Islamic Institute was founded with seed money from Abdurahman Alamoudi, a convicted jailed terrorist who pleaded guilty to accepting hundreds of thousands of dollars from Libya. Now, she is employed as a public affairs officer at the U.S. Agency for International Development – and so it appears that yet another Islamist finds employment in a branch of the U.S. government. Grover Norquist is an advocate for legitimating Shariah Compliant Finance as an ethical alternative to capitalism. And second, Norquist’s chosen battle ground for this subversive effort has been and remains the chiefly influence- and lobby-based contracts drawn up through USAID. Reply Terence Tuo 1 month ago In my humble opinion, there is too much home grown self reasoned macroeconomics embedded in the criticism of the Fed. “the Fed’s new policy will lead to unstable prices” and “the Fed’s policy has made holding dollars more risky”? QE3 is nothing new, it has been almost 4 years since the first QE – inflation has stayed consistently low and Treasury yields are at record low. Sure the benefits to QE have not emerged as originally expected but we should not go overboard to play up the dangers or discount the scenarios which could have been worse without QE. At the end of the day, alot of high level econometric work goes into the basis of the theories of economics professors. Even if we recognize economics is not an exact science, we should not belittle their life long work with vociferous counter arguments that while logical sounding, have not been proven in the modern context. Reply Joe wilson 1 month ago I am not so sure that inflationary pressures in the short term are as bad as being protrayed, but I am astounded that the announcement indiates buying MBS through 2015 ( 2 years out). The intention is clearly to re-inflate in part the housing bubble so that homeowners underwater can use the inflated equity as an alternative to the magical ATM ( money for nothing, the rest for free). The flip side of devalued dollars are us workers become cheaper on a global scale. If entitlements are raised slower than inflation or devaluation, they become cheaper in real terms and inflated incomes become a defacto tax increase as wage earners are pushed into a higher marginal tax bracket ( most of the tax law is not indexed to real inflation and devaluation). Perhaps we would be better with stable currency, but since congress is loath to address deficits, it makes sense in a roundabout manner to rachet down the cost of those deficits by making dollars worth 30 or 50% less. While hurting the middle class, it can avert the real cost of a protracted Fiscal Cliff. Reply Juno Desir 1 month ago Obamanomics in a nutshell – the GOP supports only legislation to benefit the top 1%. Obamanomics is an attempt to benefit all Americans in spite of the BUSH Cheney Disaster administration. We are in the 11th year of the GOP Bush Cheney Decline.The GOP is doing a good job of stonewalling the 99% on behalf of the 1%. - Obamanomics began on 14 April 2003, as published in the New York Times. “Tonight, the Senate Budget Committee voted along party lines to approve a budget that would accommodate the $726 billion in tax cuts and allow them to be considered in the Senate under a procedure that bars a filibuster. …The Senate budget would permit $800 billion in added tax cuts that the president wants over 10 years, including extension of the repeal of the federal estate tax. But these would be considered later and would not be protected against filibuster. …The budget President Bush sent Congress last month would require the government to run deficits for at least 10 years, the Congressional Budget Office has reported. The plan of the Senate Budget Committee shows a budget surplus in 2013.” (note:The reason a Federal budget surplus reappears in 2013 is due to the fact that the Bush tax cuts are scheduled to end in 2013.) Ann Romney : ” … we’ve released all the information you people need to know.” Staunton News Leader 4 AUG 2012 - Reply Usiku A 1 month ago Clearly this is not an objective article. You use the word “futile” before seeing what happens. You use the word “desperate” which is totally subjective and in reference to Bernanke who is a Republican. Secondly, you ignore all the evidences that Republicans have been thwarting nearly all economic efforts including holding up, since September 2011, the American Jobs Act which included 447 billion to stimulate the economy. Reply + expand 2 comments Joshua Pabelick 1 month ago That was 447 billion that was over 50% dedicated to tax cuts. The remainder was split among guarantee pay, building infrastructure, increasing unemployment benefits and a very very small percent going towards a path to work program. The bill failed because it was full of the typical Dem thinking “improve the unions and make it easier to live unemployed” while the middle class will suffer the as a result. Reply Usiku A 1 month ago Thank you for continuing to show the Republican way of wanting help for themselves but no one else. Subsidies, incentives, loopholes, tax breaks, deductions, exceptions, grants, consulting, research, studies and aid to people and places all over the world are evidences of other welfare benefits amounting to billions that only support good ole boys, the elitists and their agendas worldwide. Reply + expand comment dejahthoris 1 month ago Evidently the author does not have any investments in the stock market, which is doing quite well! He also has a short memory because he seems to be imagining the already tried and failed policies of the far right got us into debt, two wars, and created vast amounts of unemployment. He also does not read the news to see that the unemployment rate has been going down steadily, that we have stopped bleeding jobs and have been adding jobs the last few years. The American people want OUT of the Middle East, and don’t want to send our kids over there to die. The drones and espionage are a better, more modern way to keep us safe. We need to go forward, not back to what we have already tried and failed. Reply + expand comment Christopher Montoya 1 month ago The ordinary men and women on the streets today, or the working stiffs don’t own stocks! Are you a representative of the working class? Or is that just something liberals like you claim to represent to feel better inside? Those who happen to live on fixed incomes will now purchase less than before thanks to the economic policies of both the Fed and this Administration. Our standard of living is affected because of our inability to strecth our currency to cover the cost of inflation. Society is mislead into believing that either men on the podium will represent the working class. Both represent BIG BROTHER and could care less about price stability,sound money, or constitutional rights. Liberals cried when Bush passed prescription pill coverage, but if Obama or Clinton would’ve passed it you’d be applauding their actions. Hypocrites! Same goes for the republican base, which is not conservative in any way shape or form. Both parties are interventionists, inflationary, war mongering, expansionists, and welfarist. Both of you approve of large centralized governments and you disguise it as if it’s “good for society”. I don’t expect you or anyone like you to agree because you’re at a point incapable of thinking on your own. You’ve been programmed. Reply + expand 4 comments tommariner 1 month ago Better get used to it — Looks like the Presidential Campaign based on “vote for me I’m cool” and “My opponent is insensitive to comment on my actions”. I’m a business guy, trained to judge who’s experience would give them the greatest chance to succeed and judge whose work performance warrants asking them to do something else for a living — In both domestic and foreign talents, the evidence seems clear. In foreign it is smoke curling up over our embassies and domestically it is diluting the currency — so people can get jobs(!) The theory seems to be that helping employers employ is a stupid way to get jobs, while the government buying securities will result in work. You can’t make this stuff up. Reply Eric Scholler 1 month ago Thanks Mr. Bernanke! Making decisions based on your own financial or political gain isn’t what this country needs right now. The point is, its not every man doing whats best for himself. Rather, its every man doing what’s best for himself and the group. The political arena in this country is completely corrupted by greed and avarice. Why do we pay our politicians (on both sides of the isle) millions of dollars to make poor decisions?? The Founding Fathers weren’t paid and decisions were made based on genuine concern for political and economic growth and stability. It’s time we stop compensating our elected officials and repay our debt to the Chinese. Reply xeven 1 month ago Their just trying to buy our votes as usual no matter what is best for this economy,our nation or future. I really hope they do not re-elect this man. Reply Damani Harrison 1 month ago Great information in your article. However, your first sentence is absolutely horrible. It skews the entire article and doesn’t at all coincide with the overall point. Why say the feds are trying to bail us out due to Obama-economics when you clearly state later in the article that the current economic strategies were being used by the previous president as well? That sort of media bias is what is killing this country. Lift your head up and open your eyes. Give us the facts and stop trying to sway public opinion. You would be a more effective and reputable writer that way. Reply + expand comment Usiku A 1 month ago Very true. Reply + expand 2 comments Alec Epting 1 month ago Insightful commentary. Besides the points raised here, pegging Fed monetary policy to a lagging indicator, the employment rate, will only exacerbate the prospect for runaway inflation. The problem is not inadequate liquidity in the economy. International corporations are loaded with cash. The problem is the lack of domestic demand. The shortfall in demand is a direct result of falling incomes due to increases in productivity from widespread use of computers and the Internet displacing jobs heretofore done by humans in the lower to mid income strata and outsourcing to countries where labor costs are lower impacting the low, mid, and high end. The middle class has thus been systematically gutted for two decades now, masked only by easy monetary policy. The last decade saw homeowners using the equity in their homes as an ATM. Now that many homes have little or no equity, the middle class has no where to turn to borrow money to create any significant demand. Certainly credit cards at 21% interest offer no alternative. Baby boomers will also be retiring en masse, leading to a sharp dropoff in demand. So what will happen is the price of imports, especially of basic commodities, will skyrocket as the dollar weakens. By the time employment picks up, inflation will have hit runaway proportions. At that point the Fed will have to slam on the brakes via a sharp rise in interest rates, leading to massive layoffs. The Federal debt will spiral out of control, not only to provide unemployment benefits, food stamps, and healthcare, but to service the higher interest rates on the debt. The dollar will lose its reserve status as China asserts its new-found manufacturing dominance and demands payment in renminbi. They will have the military to back it up while the US sheds its military to pay off its enormous debts. All great empires have ended this way. You only have to look at Great Britain to see the course the path the US is headed down. Reply John Vernon 1 month ago “Instead, easy money and the weak dollar have crushed the middle-class with more than a decade of below average growth and falling living standards.” What kind of logic is this? Consider that 6.5 million manufacturing jobs have been sent overseas in the last 20 years. That’s what has crushed the middle-class in this country. Reply + expand comment Chuck Kreuzer 1 month ago Welcome to the world economy. It’s not like it was 30 years ago, where the US had little foreign competition. Think about it. Everyone else has been catching up, eventually surpassing us in either quality or value. Who is going to buy US products when they are more expensive or don’t have the quality? How would companies pay employees if their products are not selling? Our economy is transitioning to one that is service based. Like it or not, that’s what is happening and it’s simply not possible to turn us back into a manufacturing powerhouse, when labor rates across the globe are far less and the products are of equal quality. Reply + expand comment Chuck Kreuzer 1 month ago I had to laugh at the comments to this article. Every single one so far, has been an incoherently constructed regurgitation of democrat talking points. But, what would one expect from the party of economic illiteracy? Maybe next time you BO lovers post something, why not provide some kind of alternative solution to the problems cited in the article? With one exception (the supposed $4T Obama debt reduction that was rejected by his own party as well), he other posts here are just dribble. The fed is experimenting, much like Obama has been doing, with our economy. Experiments are performed by people that don’t know how to solve the problem at hand. But, what would you expect from Obama? He’s never had an education in economics, finance, business, management, nor a single days experience in job creation. He’s been playing trial and error with our economy. Who’da thunk that someone with ZERO relevant experience would flounder as the leader of the world’s largest economy? You’d have to be a moron to hire someone with no experience and expect expert work to be performed. But, that’s what dems did by electing this amateur. Now, his amateur status is being demonstrated in our foreign problems, but that’s another subject. Romney’s been down this road. He’s very successfully dealt with business and job creation problems. He understand economics and finance.That’s step one in the solution. Step two is to reign in gov spending. As it is, we are on track to reach $24T in debt by 2016. At the (paltry) current GDP growth rate, our debt will reach approx 140% of GDP at that time. That’s an absolute course for insolvency and a sure path to Greece. Spending must be gutted. Third, Obama’s “government trickle down economics” have increased regulations and prevented job creators from creating jobs. The private sector is what built this country, not the gov. The gov couldn’t survive without business, but business could survive without the gov. Tax breaks for businesses and incentives for private investments (not gov investments) is what Clinton used to bolster the economy (thanks to a rep congress I might add). This is just a start, but let’s face it – Obama is a rank amateur. We need an expert. Reply + expand comment Usiku A 1 month ago Romney as an expert for the good of the country and the American people is stretch. I guess he’s along the same line of experts as Bush, Jr and Bush, Sr. and Reagan of all our American glory years. Reply + expand comment 18mc 1 month ago Thanks to Obamanomics, investments in gold have more than doubled as the dollar droooooppped because of his policies. Reply lcr1946 1 month ago OK! Time to get a grip on reality. One of the big problems in recovering from this recession has been people listening to stuff like this. While I agree that Obama has not followed the most effective policies, the recommendations made in this article are once again based on the hard dollar and a gold standard. Reagan created a commission to study a return to the gold standard. He was looking far how to do it. The report he got back said don’t do it. The worlds monetary needs in dollars cannot survive being linked to the price of gold. People have been spouting this gold standard, hard dollar stuff for years and it doesn’t work. Limiting the amount of money available for use is a surefire way to create an absolutely unnecessary financial collapse. Now there is no doubt of that. We’ve had plenty of experience with liquidity collapses and even considering limiting our ability to manage ourselves is foolish. Consider that there would have been a much worse financial collapse than occured in 2008. If the number of dollars the Fed had to operate with were fixed, the Fed would not have any way, after its supply of dollars is used up, to provide dollars to the banks so they can pay back loans to other banks, pay their bills and meet their depositors demands. The Fed’s ability to take collateral from banks and give them dollars from an unlimited pool allows it to keep banks from failing because they could not sell enough loans or borrow enough cash from other banks to meet demands for payment from them (the bank). They may have plenty of assets and be profitable, but if they can’t produce the cash required by a depositor’s withdrawal, they’re insolvent. Now if they can go to the Fed and say I’ve got 2 million in good loans here and I need to borrow a million to meet my cash needs and get the million from the Fed, all is well. If the Fed says we have no money, we’ve used it all, we’ve got a real problem. Called-out comment Reply + expand comment Terence Tuo 1 month ago Thanks LCR1946. Among the buzz of patisan soundbytes in the other comments, this cuts through with its clean economic logic. Also backed up with a simple example for the packs of dining table conversational economists out there. Reply Author Charles Kadlec, Contributor 1 month ago Dear lcr1946 Your comment reflects a general misunderstanding of how the gold standard works. The goal of a gold standard is not to artificially limit the quantity of dollars, but to guarantee the quality of the dollar. Under the gold standard, we would continue to use currency, checks, credit and debit cards, and all of the other modern financial instruments. The key difference is the dollar, in all of these forms, would be defined as a unit weight of gold. Since under a gold standard, the buying power of gold is far more stable than the paper dollar, making the dollar as good as gold means that its buying power too, becomes more stable. Here is the way a gold standard works to make sure that there are as many – or as few – dollars as people demand at the fixed rate of exchange into gold: If there is a shortage of dollars, people would begin to turn in their gold for dollars. This would require the Fed to print more dollars and avoid any sustained deflation. Conversely, a surplus of dollars would lead people to turn in their dollars for gold, and require the Fed to stop printing money or even contract the money supply, thereby avoiding inflation. In the vernacular of economists, the supply of dollars is completely elastic at a fixed rate of exchange into gold. Had the Fed stabilized the price of the dollar in terms of gold during the 2008 financial crisis, it would have reacted more quickly to the deflationary forces unleashed by the shift out of money market funds into the banking system and, as a consequence, it is likely the crisis would have been less severe. As forbes.com columnist Nathan Lewis explained in a recent column: http://www.forbes.com/sites/nathanlewis/2012/08/30/would-a-gold-standard-have-worsened-the-2008-financial-crisis/ “Let’s take, for purposes of example, a period from the end of June 2008 to the end of June 2009. The U.S. stock market had not yet begun to fall rapidly in June of ’08; indeed, the S&P 500 finished August at about the same level as it ended June. By the end of June 2009, the S&P500 was already recovering rapidly from its low in March 2009. “The value of the dollar was $930.25 per ounce of gold at the end of June 2008. At the end of June 2009, it was $981.75 per ounce. Thus, on a point-to-point basis, the dollar was not devalued during this crisis period. Indeed, if the U.S. had been on a gold standard system at the time, let’s say at a parity of $1000/oz., the outcome would have been about the same on a point-to-point basis. The value of the dollar would have been $1000/oz. at the end of June 2008, and the same $1000/oz. at the end of June 2009. “The dollar did not remain at an even value throughout the crisis period. Nor was it devalued, as the Keynesians like to imply. No, the dollar went up! In October of 2008, the dollar hit a high of $712.50/oz. (London PM fix basis). It then fell back. This spike in dollar value was reflected also in exchange rates with other currencies. The Federal Reserve’s broad trade-weighted dollar index went from 95.76 at the end of June 2008 to a high of 112.49 in November 2008, before falling back to 105.35 at the end of June 2009. “The basic reason for the financial crisis of 2008 was bank insolvency. Many banks had made too many loans to borrowers who could not pay them back. The prospect of widespread and chaotic bank default loomed. This spike in dollar value, in the middle of the crisis, just added a new problem to an already problematic scenario. “A GOLD STANDARD WOULD HAVE PREVENTED THIS SPIKE IN DOLLAR VALUE. (Emphasis added.) The value of the dollar would have remained at a stable $1000/oz. throughout the crisis period. If other countries were also using gold standard systems, then the exchange rates between their currencies and the dollar would have remained fixed and predictable, instead of varying wildly.” If you would like to learn more about why a 21st Century Gold Standard would increase the prosperity, security and liberty of the American people, you may download for free the booklet I co-authored on this very topic at agoldenage.com Called-out comment Reply + expand 3 comments Charles Murdoch 1 month ago Please, if you are going to use the term “Obamanomics” and “Obama administration economic policies,” please define them. From my perspective, very little of what Obama has proposed has been passed. From what I see, Government employment (both state and federal) is down sharply. From what I see, growth in government spending is the lowest it has been in decades. From what I see, tax rates and overall tax revenue is down sharply. Republicans want to cast Obama as a tax and spend liberal and want to blame those policies for our weak recovery. The truth is that the Republicans have effectively blocked anything Obama has tried to do and are now trying to blame him for the resulting slow growth in jobs and GDP. If this works for the Republicans and Romney wins and the Republicans gain more seats in the House and Senate, what strategy do you think the Democrats will follow? I’m afraid that if this works we’ll be in for another 2-4 years (at least) of legislative sabbotage. Reply Don Ake 1 month ago You can only bail out so much before the ship starts to sink. Time to get on a new ship! Please Google: Model T Stock Trends the sound of silence Reply Hossein Kazemi 1 month ago Forbes is a rich man and his magazine is profitable enough to hire someone with at least some basic understanding of economics and finance to check this guy’s articles. There too many gems in this article to mention, but here is one: “..increase in the price level of 2% a year, or a 33% devaluation of the dollar over the next 20 years.” Last time I checked 2% inflation per year for 20 years means about 48% decline in the purchasing power of dollar. Spend $5 on a calculator. Here is another nonsense: “Now, the quantity of money will increase at a fixed, $40 billion a month, which, by necessity means any change in the demand for dollars that does not precisely match the increase in the dollar’s supply will produce a change in the price of the dollar.” Where do you get these stuff? Quantity of money has increased by a factor of 4 during that last 5 years and yet there is no significant price change. You know, there is something called the velocity of money. Check your econ 101 textbook, you may learn something. While you are at it, also check open market operations to learn how it works and how it affects the money supply. Reply Author Charles Kadlec, Contributor 1 month ago Dear Mr. Kazemi, Allow me to clarify: A 1/3rd devaluation of the dollar produces a 48% increase in the price level. As you point out, 2% compounded over 20 years (1.02 ^ 20) – 1 = 1.4859 -1=48.6%. Reducing the dollar’s value by 2% a year for 20 years calculates (.98^20)-1 = .667 -1 = .33 or 33%. Changes in velocity are economic jargon for changes in the demand for dollars. The reason the huge increase in the quantity of money (monetary base) relative to the increase in real goods and services since QE1 has not been accompanied by an equivalent increase in the price level is that the velocity of the monetary base has fallen, which is another way to say that the demand for dollars has increased. So, to put the point in your terms, unless the change in the velocity of the monetary base matches precisely the inverse of the increase in the dollar’s supply relative to the output of real goods and services, the net affect will be a change in the price level. If velocity falls by less (or increases), the result will be inflation. If it falls by more, the result will be deflation. Called-out comment Reply + expand 4 comments Aaron Greenhill 1 month ago These days it doesn’t matter which side of the aisle you’re on – both Republicans and Democrats are spending like there’s no tomorrow. Hence the title of this article is absurd. Reply Krista Gifford 1 month ago Romney will not support a hard money stance for exactly the same reason that Obama will not do so. Hard money would prevent the government from pursuing deficit spending. So the government would have to raise money for government spending honestly – through taxes – or they would have to cut spending. The public wants it’s cake and to eat it too – and so they don’t want a president who takes away the supposed free lunch of government spending. Of course, the truth is that the public pays for this spending anyway -through inflation – but they don’t see or understand this. So deficit spending and soft money allow the politicians to spend without taxing (spending is popular/taxing is unpopular). This also allows a great expansion of the size of government which increases the power of politicians. There is no incentive for politicians to pursue hard money when that would curtail their power and their popularity. No matter that it would restore real prosperity. The politicians just want power and popularity at any cost. Reply Dwain 1 month ago LIES LIES and more LIES. ITS not QE but LQ (Lies in quantity). When will the babbling ministry of propaganda (mop heads) report facts? Its the banks stupid, not the economy dictator Berny is trying to prop up. Please report facts so citizens can make informed decisions. Reply Business Leaders for Obama 1 month ago The Dodd-Frank Act created reforms to assist the financial system and small businesses. Reply Posted by keeptheshuttleflying.com at 1:23 PM No comments: Email This BlogThis! Share to Twitter Share to Facebook