Wednesday, February 15, 2006

Bernanke Says Economy Is "On Track" And I Say, To Hell


By Elaine Meinel Supkis

Bernanke told Congress what they wanted to hear: everything is coming up roses and the economy is "on track" and we are going to grow and grow and the Chinese can't sink our ship since they "only" hold around a quarter of a trillion plus in government bonds (!!!!!) so they can't deep-six us. I suppose this is part of the war plan to make the Chinese laugh to death?
And no one mentioned "Japan".

From Associated Press:
Federal Reserve Chairman Ben Bernanke, delivering his first economic report to Congress, declared Wednesday that the economy has snapped smartly out of an end-of-year lull, although inflation and other risks remain. He left the door open to higher interest rates in the future.

Recent economic barometers on jobs, production, retail sales and other business activity in January "suggests that the economic expansion remains on track," Bernanke told the House Financial Services Committee. The expansion, he said, does have "a lot of staying power."
OK, gang, what exactly are we "expanding"?

Well, the trade deficit. Walmart and other box stores are expanding. Alas, most of what they sell is manufactured in Chinese factories. Hmmm. There are more construction jobs last year but that seems to be going on the fritz now. Real Estate Agents! Yes! 009 himself! He will save the economy from Goldfinger!

Of course, Congress and Bernanke refused to say what track we are on, didn't they? They just said, we were on "it". "It" seems to be the track leading to a third world nation status. The only factory jobs created this year were in Japanese assembly spots set up to keep a good throttle hold on our market. Our car companies did near zero business in Japan. We sold a lot of cars in...China! The place we have decided to fight! Talk about stupid.

Well, maybe we could export real estate agents, lawyers (shot up ones are going to be sold at a discount), has-been politicians, K Street lobbyists and TV preachers. Then we might, just might save America!

For a slightly more realistic, downbeat assesment of this crazy hearing, from the NYT:
In an generally upbeat assessment of the economy, the Federal Reserve's new chairman, Ben S. Bernanke, told members of the House of Representatives that the Fed may have to raise interest rates a bit further to assure that inflation does not flare up.

Noting the difficulty of predicting the course of the economy, Mr. Bernanke said: "Nevertheless, the risk exists that, with aggregate demand exhibiting considerable momentum, output could overshoot its sustainable path, leading ultimately — in the absence of countervailing monetary policy action — to further upward pressure on inflation."
RED ALERT!!!

Danger: completely stupid economist with great powers running into competely corrupt politicians! How on earth will "output" cause inflation? Output was supposed to be "manufactured stuff" and he is using it to describe people buying things merrily because there is tons of money running around, purchased via cheap, below inflation rate loans! And this will cause inflation, all right, in HOUSING. Which is exactly what has been going on so far! And which is excatly what is wrong with everything! The Fed deliberately turned our homes into ATM machines so we can churn out money to our heart's content and of course, buy stuff which never showed any inflation because the Chinese pegged the yuan to the dollar and the Japanese do this even more outrageously.

Inflation won't happen because people want to buy stuff, it happens because the irresponsible Fed is upping the money amounts while not backing it with anything and the only reason this worked so far is because the Chinese government needs to entrap us by selling us IOUs which they plan to collect in a horrible way since the game we are playing, "Let's see who consumes all the planet's resources" is a very deadly game which will end when everyone decides to cull the world's population just like Hilter decided to do way back in 1933 with his "Lebensraum" program.
Investors have been eagerly anticipating Mr. Bernanke's remarks to see how and if the Fed changes, even slightly, any of its philosophical or policy positions. Some analysts have questioned Mr. Bernanke's commitment to fighting inflation because of past remarks and studies he has done on the risks of falling prices. As he has done in the past, Mr. Bernanke said he "maintain continuity" with the "Greenspan era." Another topic of abiding interest among investors and Fed watchers is the housing market, which was described last year by Mr. Greenspan as "frothy."

But Mr. Bernanke has inherited a markedly different situation. Instead of worrying about the excesses of housing, he provided assurances that the housing market was not in danger of falling off a cliff. He noted a slowdown in sales, rising number of unsold homes on the market and weakening confidence among home builders and buyers. He added, though, that mortgage interest rates have only risen moderately.
A lot of people are making fortunes on the present, crippled, dangerous track. They don't want the gravy train to stop. They don't want it shuttled off to another route. They don't care if I am walking along the roadbed, swinging a red lamp, waving my arms. Who is this odd female? Best to ignore her.

And yes, I once did walk along a real train track, waving a red lamp because a violent thunderstorm did wash out the roadbed. The train stopped, by the way. So it didn't make the news.

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