Fed ties rate pledge to a threshold as new stimulus set

Comments (34)
minipaws wrote:

Yeah, devalue the dollar, then we become the lowcost country. India and China will ship us all of their work. Problem solved. Brilliant!

Dec 12, 2012 7:12am EST  --  Report as abuse
Robertla wrote:

stagflation and asset bubbles………

this is about keeping the government and speculators, able to service their debts. keeping prices high. people who spend a large portion of their income on food, gas, rent are going to get hurt buy this………

income disparity will increase, and one commodity shock………we’ll be back to a feudal state.

too bad for the serfs.

Dec 12, 2012 7:40am EST  --  Report as abuse
Robertla wrote:

A popularly-alleged quote by Mayer Amschel Rothschild:

“Give me control of a nation’s money supply, and I care not who makes its laws.”

Dec 12, 2012 8:24am EST  --  Report as abuse
sittingduck wrote:

The Fed seems dead intent on pumping money into the system regardless of better than expected employment and economic growth numbers. Adding more money to the system will unnecessary add fuel to the belief that the Fed is funding the Presidents and Congress’s spendthrift ways. There has been no connection between the Fed’s expanding balance sheet and the real economy. The Fed only risks further inflation which fortunately has not happen thanks to the expectations of lower energy prices due to new finds in America.

Dec 12, 2012 8:56am EST  --  Report as abuse
Harry079 wrote:

“keeping the monthly pace of total asset purchases at $85 billion”

$85 billion a month is 14X more than they spend on unemployment benifits.

Dec 12, 2012 9:38am EST  --  Report as abuse
Jameson4Lunch wrote:

@sittingduck – better than expected employment and growth numbers you can expect to be revised in the coming months. Our current economic policies are a matter of management of perceptions. So long as people have faith in the economy, the economy is okay. When that faith deteriorates, the fiat system can’t work. A truly epic confidence job.

Dec 12, 2012 10:17am EST  --  Report as abuse
robertsgt40 wrote:

Memo to Ben: We don’t have a liquidity problem. It’s insolvency. We are insolvent. Welcome to the 21st century Weimar Republic. Ben going for the kill shot. All ahead full!

Dec 12, 2012 11:17am EST  --  Report as abuse
Jameson4Lunch wrote:

So, the markets participants will now have incentive to actively work to keep unemployment above 6.5%, less the liquidity tit dry up… brilliant!

Dec 12, 2012 12:57pm EST  --  Report as abuse
randburg100 wrote:

Does Bernanke know that Walmart will be selling rolls of $ bills triple soft for the user’s butt? There will be various roll sizes $500million – single ply, $400million triple ply and for rich butt $1bn triple ply and extra fluffy….

Once the trial period ends, Walmart will move the idea to the UK but just print pounds on them and for euroland just print euros on them….

Dec 12, 2012 12:58pm EST  --  Report as abuse
Harry079 wrote:

“pumps more money into economy”

Who’s economy does that $85 billion a month go into?

Not anyone I know.

Dec 12, 2012 1:39pm EST  --  Report as abuse
John1980 wrote:

Stock market slaps a vein as Black Tar Ben injects another dose. Thank goodness we’re not relying on the actual economy to drive the markets.

Dec 12, 2012 1:45pm EST  --  Report as abuse
Alpha_Blogger wrote:

This policy has not worked for the last 4 years so they are going to try it for another 4 years just to be sure it does not work.

Dec 12, 2012 2:00pm EST  --  Report as abuse
Crash866 wrote:

Haven’t we seen this movie…that hole gets bigger….

Dec 12, 2012 2:18pm EST  --  Report as abuse
Crash866 wrote:

“They see an anemic economy, and they’re doing all they can to get any economic progress,”
And most vote for Obama. Go figure. Cool Hand Luke “Some men you just can’t reach” “This is the way he wants it…well…he gets it”

Dec 12, 2012 2:21pm EST  --  Report as abuse
tmc wrote:

I think inflation is the real goal. Lot’s of inflation. Goes with the global wages article also on Reuters today.

Dec 12, 2012 2:24pm EST  --  Report as abuse
wthcares wrote:

But that “war on women” was won… right?!?

Dec 12, 2012 3:12pm EST  --  Report as abuse
UauS wrote:

“..inflation is running somewhat below the central bank’s 2 percent objective.” – really? who sent them this information – Curiosity from Mars?.. They’d better visit a nearby grocery store a few times a month to see what REAL inflation is.

Dec 12, 2012 3:19pm EST  --  Report as abuse
richard233 wrote:

So continues the theft of the savings of our seniors and those
who are preparing for the future. An attempt to convince people
to “invest” in the casino known as the stock market and to prop
up the prices of real estate which would otherwise fall if things
were allowed to act naturally.

Dec 12, 2012 3:42pm EST  --  Report as abuse
Tiu wrote:

Look, all this talk of money is fine, but the by far the most important issue exercising our leaders minds is quite rightly that of Gay Marriage. Now surely that’s far more important. What difference is 40 billion here or there, you can always print more money – they just didn’t do it the right way in Weimar, they made the notes to big and it brought down the system, keep it in small denominations.

Dec 12, 2012 3:44pm EST  --  Report as abuse
cebva wrote:

We are already over the fiscal cliff no matter what Congress and the President do. Wall Street is whistling past the graveyard. What if we NEVER get to 6.5% unemployment? We used to say 4% was the “norm” but we have had another generation of welfare dependents since those days. And who is doing the counting? We know the situation is much worse than the 7.9% reported.

We’re looking at a future of inflation, stagflation and decline.

Dec 12, 2012 3:46pm EST  --  Report as abuse
OzBolts wrote:

Ignorance of the real problem at hand.

“The reason it’s come down this year is primarily due to the fact that more and more people have just stopped looking for work

The statistics are so brutally skewed. Those who have stopped looking for work altogether (which is a fairly large segment) are taken off that jobless number. Furthermore, this whole strategy and “we’re gonna be okay” attitude ignores the replacement of the lost middle class jobs with low paying, low skill jobs.

Are there new opportunities out there? A few… but that good manufacturing job, or administrative position you used to work no longer exists.

Welcome to the land of cheap retail jobs, fast food hell and a myriad of other, state sponsored, “just making sure you don’t starve” positions.

How much longer will this economy hold on until it just collapses in on itself?

Dec 12, 2012 3:51pm EST  --  Report as abuse
TheNewWorld wrote:

Maybe Ben is waging a war on China’s rhohimbe by devaluing the dollar. If you have savings, I suggest going out and buying something real. That paper is going to be worthless. If I had the funds, I would invest in real estate. It is low, precious metals are high.

Dec 12, 2012 4:01pm EST  --  Report as abuse
Butch_from_PA wrote:

I have a friend who makes 75K a year and he’s been with the same company for 11 years. No debt, good saving supply and his bank which pre-approved a house loan and the last minute denied him – worried about the risk.

This fed push of more money into the economy is simply a giant giveaway to banks – who would rather investing their free money by lending it right back to the government instead of lending it to stimulate the economy.

What is wrong with this picture? Is Ben in bed with the banks so they can grow richer on government financial welfare? You bet. Is this legal – you bet. Is it screwing you and me – you bet.

Is printing more money stimulating the economy? Nope!

Can you and I borrow money from the government for 0 interest and then turn around and lend it to the government with a guarantee of no loss and a small marginal interest on the money? Not unless you want to go to jail.

Wow we have legalized criminal behavior for only the elite.
Is the class warfare? No. Is this the new feudal system? You bet.

Should you be mad as hell? Depends if you have any fight left in you.
Financial worry and debt makes your fighting spirit weaker and weaker.
You need to be really hungry and watch a few close relatives die before you get mad as hell.

Dec 12, 2012 4:03pm EST  --  Report as abuse
Jameson4Lunch wrote:

Spot on, Butch. This isn’t stimulus. It’s federal debt monitization. There are plenty of sleight of hand obfuscations that have been added to the system, but it’s not too far removed from Wiemar.

Dec 12, 2012 4:15pm EST  --  Report as abuse
Rich_F wrote:

its easy to get to 6.5% unemployment, just continue letting the participation rate fall and viola! heck why stop at 6.5% you can get it to 0% using the same approach.

Dec 12, 2012 4:45pm EST  --  Report as abuse
JoeObserver wrote:

Bernanke is Lucky as Romney was not elected.

Dec 12, 2012 4:49pm EST  --  Report as abuse
dsquad wrote:

The fed has a hammer, and even though the prblem isn’t a nail, the fed’s still going to smash everything in sight. (Brilliant analogy by Peter Schiff)

Dec 12, 2012 4:52pm EST  --  Report as abuse
CF137 wrote:

Why does Ben keep acting like he’s doing us a big favor by keeping interest rates at zero? Interest rates can never be raised, ever again, raised because we’re $17 trillion in the hole, at interest already, and we’re currently going into the hole at the rate of $1.5 trillion per year. There’s no way we can pay more in interest on any new national debt.

Dec 12, 2012 4:54pm EST  --  Report as abuse
USAPragmatist wrote:

Instead of trying to refute all the mis-information in this thread of comments, I will make one statement…

It is either extremely funny or just plain sad, that arm chair economists think they know more about the economy then those that have dedicated their lives to the study of economics. And if you ask those that have dedicated their lives to the study of economics, you will realize that a large majority of them applaud what the Fed has done since the crash. Particularly when you consider that the preferred way to help us ‘limp’ through the shock of this massive credit crash would be government stimulus, and we all know that the GOP has cared more about trying to make Obama look bad then to do what is right for the economy. So the FED has stepped in and done what they can.

Dec 12, 2012 5:35pm EST  --  Report as abuse
deerecub1977 wrote:

The fed is a sham and millions if not billions of people know it ,yet they have us by the bats

Dec 12, 2012 5:44pm EST  --  Report as abuse
MikeyLikesIt wrote:

I was wondering if USA Prag was going to show up with his usuall post of absolute insanity, and sure enough here he is!!

Tell me something Prag, if the current policy of “Stimulus” has worked so well, why is the economy not roaring at 10% GDP growth by now? I mean Obama and helicopter Ben have only pumped about 7 TRILLION dollars into the banks in the past 4 years.

What gives?

And as always you blindly defend your boy obama simply because he has a (D) after his name. Or is it because he is half black?

Dec 12, 2012 6:03pm EST  --  Report as abuse
JoeObserver wrote:

If printing money were the solution, Zimbabwe would have been the richest country of the world. Some common sense should prevail among the Fed members. They may be endangering future generations of the American people by their action.

Dec 12, 2012 7:37pm EST  --  Report as abuse
matthewslyman wrote:

I think this is an interesting move. Inflation can be caused not only by an increase in the money supply, but by a decrease in economic activity (or some other decrease in the availability of goods and services). The Fed is now saying they’re going to take a more sophisticated position — they’re going to target what they consider to be the “sweet spot” between employment (productivity) and inflation (monetary manipulation of market expectations, which at 2%, is also targeted at productivity).

Some (very small) level of unemployment is necessary to the functioning of a free-market economy. People have to be available to start work, in order for people to be available to hire, or available to spend their time looking for the ideal position. I think it’s time to destigmatize the unemployed, and do something more to help them back into work. If that means realigning the economic goal-posts so we don’t cheat the workless by making their prospects completely hopeless; then let’s do it!

Dec 13, 2012 4:45am EST  --  Report as abuse
matthewslyman wrote:

@JoeObserver: IT would be a dangerous strategy for the Federal “Reserve” (sorry, I can’t take the second part of their name seriously — just can’t say it without a smirk) IF there were better alternative places for investment that could stand independently of the American system. Where are they?

Dec 13, 2012 4:47am EST  --  Report as abuse
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