It sure looks to me that "quantitative easing" can't create jobs or help business. In reality, it's the path the US government will use to print money to disappear most of its debt, as it must do if it continues to spend far more than it takes in. It's equivalent to reneging on promises and stealing everybody's savings.
Not than balancing intake with expendatures inherently fixes anything. It's the level of spending that hurts. And you can only steal everybody's savings once a generation or so.
Happily, bankers only screw up royally once a generation or so. The last bunch of screw-ups have to die off before the rising generation is free to repeat their mistakes.
If bankers got a proper education and read a bit of history they might be less likely to repeat the mistakes of their predecessors, but the ones I've met didn't seem to see the need to know anything about anything except money.
America is deliberately weakening its currency to make life easier for its exporters and devalue the foreign loans it holds.
Serious global banking MFUs follow a roughly 80 year cycle.
The previous massive global disaster was in 1930 and before that 1847 when "clever paper instruments" and a volatile market caused chaos leaving employers at one point with no way to pay for goods or their employees. Essentially the same as the recent banking crash where bankers no longer trusted that inter-bank debts would be repaid. 1847 was complete with stroppy public letter from the Governor of the Bank of England to bankers and nearly led to abandoning the gold standard. Paris and London were mainly affected and their respective empires.
I know of no connection with reducing US gov debt.
It's another giveaway to the bankers (and probably Fannie & Freddie)
- which these funds are going to go to, and reducing the exposure of AIG. And by devaluing our currency (I presume this is what you're referring to savings) it's a way of making the US commerce a bit more competitive.
I guess our previous gifts weren't enough.
Brought to you by Bernanke, Summers, and Geitner - it's really disappointing that they are still in government.
Our problem is spending more money than we have. $3.5T/$2.1T =3D $1.67 spent per $1 in income in '09. The social insurance programs alone exceed our total national means, we've known that's been coming for a decade or more, and Obama's thrown gasoline on the fire. Obamacare, for example. The Fed buying Treasury bonds doesn't fix that, it facilitates it. That's bad.
OTOH, QE2 does effectively redistribute wealth, from people who've saved to people who haven't. That's why the Chinese, the UK, Germany, Japan, and the other countries that have loaned us money (the biggest sub-prime loan of all time?) don't like QE2, not one bit.
Bankers are in business to make money, and they have to compete. Government should sensibly regulate them. Bill Clinton signed the dereg law that started the crash.
Which means that China will dump its $$$ causing a $$$ crash. However, most of the world will not be a lot worse off. Besides, who apart from Americans will complain if they pay $15 a gallon for gas?
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Dirk
http://www.transcendence.me.uk/ - Transcendence UK
http://www.blogtalkradio.com/onetribe - Occult Talk Show
There is no mistake, these people are both clever and educated: They act deliberately. The present reward structure ensures that not only will they actively seek to repeat previous "mistakes", because "they work", they will even leverage them 100x or more - and why not, if they lose their bets, the only downside is that they get bailed yet again and Obama performs a stern speech.
The only education that would fix bankster behavior is a 20-years re-education trip to the northern Chinese rice paddies, Mao-style ... but the politicians who have the power to legislate are all getting percentages so that will never happen - BTW: "recovery" means "a speedy return to business as usual".
Banking is in fact operating like the typical street gang: You get to run whatever scam you are good at as long as you remember to pay The Man a cut of the action (and do not rip off The Man too much) - this payment is normally mentioned as "a settlement" in the news.
If you are a TBTF-bank you can even launder plane-loads of drugs money for years; You dont go to jail, No, instead you pay a percentage of the profits and have to listen to a stern talking to from Obama for a little while until the headlines are replaced with whatever happens on "Americas Next Idol" or some golfer shagging some models.
They are buying treasuries, namely government debt obligations, and printing money to do it. There's a double adavantage; inflation will reduce the value of the debt that they don't buy.
The financial side of the US government is run by Goldman Sachs and Harvard U.
If bankers got to go bankrupt and wind up on the street with "will work for food" signs like they deserve for making bad financial decisions, and which would be the case in a free market (or even a regulated one without politicians on both sides of the one-party system being owned by the financial industry), then they would surely learn their lesson.
Also, if they have comitted fraud, then they should be punished according to the law.
It is because both of these things are not being allowed to happen by the government, that they are not only not learning their lessons, but being conditioned to expect that they can just do it all over again.
Only the government can create such perverse incentives.
It is entirely hopeless to expect any meaningful reform as long as the Federal Reserve exists in the USA.
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Mr.CRC
crobcBOGUS@REMOVETHISsbcglobal.net
SuSE 10.3 Linux 2.6.22.17
That didn't start it. The lit match came after, with the combination of the funny new paper (commoditized home loan debits) and massive = quantities of no-doc loans adjustable loans to people who could not possibly handle an upward change in interest rates. Aided and abetted by Sen. Balmy =46rank daily insisting on more loans to the poverty stricken.
I understand that the government is going after the banks for these bad loans with fraudulent paperwork. The next shoe is the mortgage companies, any that are still in business, anyway.
But the bill that Clinton signed, the one that ended the Glass-Steagall Act, started the irresponsible lending boom. Sure, it took a little time for it to get rolling. But the G-S repeal made it possible, maybe inevitable.
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"The repeal of the Glass?Steagall Act of 1933 effectively removed the separation that previously existed between Wall Street investment banks and depository banks and has been blamed by some for exacerbating the damage caused by the collapse of the subprime mortgage market that led to the Financial crisis of 2007?2010.[4] The potential to make enormous profits trading mortgage-backed securities with artificially high ratings[5] encouraged banks to take on otherwise intolerable risk in the form of bad loans. The ease with which people were obtaining home loans contributed to an artificial housing boom and exacerbated the inevitable decline.[6]"
And if you look more closely you will see the work Senator Phil Gramm did to slip this repeal into the federal budget bill that Clinton had to sign to prevent the government from shutting down.
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