Showing posts with label Federal Reserve. Show all posts
Showing posts with label Federal Reserve. Show all posts
Friday, December 16, 2011
Thursday, December 1, 2011
What The Heck, Let's Just Flood The World With These Fresh Dollars We Conjured Up. What Could Go Wrong?
OS didn't check the news til late afternoon--DJIA up 500 points in one freaking day.
And we thought we were all in deep doo-doo, what with most of the Western World in debt to the tune of trillions of dollars, which of course will be mathematically impossible to repay.
So, solution: Just print up some more, throw it at the stock market. That will make everything just a-o-k!
Why didn't we think of this earlier?
Well, actually, Virginia; look up 'Weimar Republic' to see what occurs from massive money printing....eventually they ended up with a little guy with a funny mustache and a messianic belief in himself. That worked out, ok, didn't it?
Well, didn't it?
And we thought we were all in deep doo-doo, what with most of the Western World in debt to the tune of trillions of dollars, which of course will be mathematically impossible to repay.
So, solution: Just print up some more, throw it at the stock market. That will make everything just a-o-k!
Why didn't we think of this earlier?
Well, actually, Virginia; look up 'Weimar Republic' to see what occurs from massive money printing....eventually they ended up with a little guy with a funny mustache and a messianic belief in himself. That worked out, ok, didn't it?
Well, didn't it?
Wednesday, March 2, 2011
Bob McTeer's Remarks To Rotary 2 March 2010
OS believes in reading a wide variety of views, since he has the same bad habit as everyone else: Reading stuff that always reinforces what one already believes.
Bob McTeer is an essentially sober soul, with an impressive resume.
He takes the view that TARP, the extraordinary Fed actions, etc., were necessary and did avert a worse disaster. And, that the current course of governmental spending is unsustainable.
There's a lot left unsaid here, that OS wishes would be said, especially about the moral hazard baked into the culture--'If I'm a really big player, I can be reckless, 'cuz help is always on the way.' Think AIG...
But, still, perhaps his little piece of turf is something everyone could stand on while they work out the painful details of WhatHappensNext.
Bob McTeer is an essentially sober soul, with an impressive resume.
He takes the view that TARP, the extraordinary Fed actions, etc., were necessary and did avert a worse disaster. And, that the current course of governmental spending is unsustainable.
There's a lot left unsaid here, that OS wishes would be said, especially about the moral hazard baked into the culture--'If I'm a really big player, I can be reckless, 'cuz help is always on the way.' Think AIG...
But, still, perhaps his little piece of turf is something everyone could stand on while they work out the painful details of WhatHappensNext.
Thursday, February 17, 2011
Tuesday, November 23, 2010
Barney Frank Joins LittleTimmy's Spin For The Fed
That paragon of good judgment, Barney Fwank, joins Timmy in decrying those Wascawwy Wepublikans who dare to criticize Da Fed.
Oh, the humanity.
“I was appalled to see a group of Republican economists from the Bush and Reagan administration” arguing against the Fed’s asset-purchase program. “Republicans are joining the central bank of China in attacking Bernanke. This is really distressing to me.”
Frank, who spoke in an interview today on Bloomberg Television’s “In Business with Margaret Brennan,” called the Fed program to purchase $600 billion in assets through June “a very reasonable thing” that isn’t fueling inflation, as Republican critics contend.
A group of 23, including former Republican government officials and economists, published a letter to Bernanke urging him to halt the expansion of monetary stimulus because it risks an inflation surge. Separately, John Boehner, nominated to be the next House speaker, and three other Republicans leaders last week sent Bernanke a letter expressing “deep concerns” about a policy they said risked weakening the dollar and fueling asset bubbles.
Mr. Frank might be better served attending to his paper shredders.
Oh, the humanity.
“I was appalled to see a group of Republican economists from the Bush and Reagan administration” arguing against the Fed’s asset-purchase program. “Republicans are joining the central bank of China in attacking Bernanke. This is really distressing to me.”
Frank, who spoke in an interview today on Bloomberg Television’s “In Business with Margaret Brennan,” called the Fed program to purchase $600 billion in assets through June “a very reasonable thing” that isn’t fueling inflation, as Republican critics contend.
A group of 23, including former Republican government officials and economists, published a letter to Bernanke urging him to halt the expansion of monetary stimulus because it risks an inflation surge. Separately, John Boehner, nominated to be the next House speaker, and three other Republicans leaders last week sent Bernanke a letter expressing “deep concerns” about a policy they said risked weakening the dollar and fueling asset bubbles.
Mr. Frank might be better served attending to his paper shredders.
Monday, November 8, 2010
Plain English, Black Humor: The Fed's QE2 Announcement Translated For The Rest Of Us
This, in OS's humble opinion, is eye-wateringly funny.
(You'll need to click the link to understand...)
An intrepid soul at Slate Labs has created a tool to allow the translation of obtuse, jargon-filled articles, designed to mask the truth from the reader, into Plain English.
The tool itself is called 'Plain English', it's still in development, and the possibilities are breathtaking, if it were to be employed widely.
It works like this: Each original phrase is highlighted. Click the phrase, and the Plain English version appears. Since OS doesn't have the tool, he'll have to just describe it:
(In this example, the latest pronouncement from WeimarBen and the Fed is translated.)
The original phrase is--Information received since the Federal Open Market Committee met in September confirms that the pace of recovery in output and employment continues to be slow.
The Plain English version is--The economy still sucks.
The translation gets funnier from there.
A few days back, OS noted that candor comes with a terrible price to the one willing to exercise it. That's 'cuz the jargonistas have taken over, and have learned to use language as a means of confusion rather than communication. Then when normalistas (you know, people who have consciences and think that words have meaing) encounter this nonsense and melt down in frustration, the jargonistas calmly look over their glasses, chide normal people for being stupidly ill-tempered, and call security.
We may finally have a weapon with which to fight back! Plain English! Laughter! It's the secret of Mel Brooks' genius--Blazing Saddles and The Producers are both great examples of Plain English humor.
If nothing else, it can help relieve the stress. Hells-bells, ever'body! When the Fed just got through printing up 1.2 trillion dollars out'ta thin air to buy up damn-near ever' mortgage in the country, then decides to throw another 800 billion on the fire, just fer good measure, ya just gotta laugh!
It may well all end in tears, but we gotta keep morale up, one household at a time, 'cuz life will have to go on, on way or t'uther.
(You'll need to click the link to understand...)
An intrepid soul at Slate Labs has created a tool to allow the translation of obtuse, jargon-filled articles, designed to mask the truth from the reader, into Plain English.
The tool itself is called 'Plain English', it's still in development, and the possibilities are breathtaking, if it were to be employed widely.
It works like this: Each original phrase is highlighted. Click the phrase, and the Plain English version appears. Since OS doesn't have the tool, he'll have to just describe it:
(In this example, the latest pronouncement from WeimarBen and the Fed is translated.)
The original phrase is--Information received since the Federal Open Market Committee met in September confirms that the pace of recovery in output and employment continues to be slow.
The Plain English version is--The economy still sucks.
The translation gets funnier from there.
A few days back, OS noted that candor comes with a terrible price to the one willing to exercise it. That's 'cuz the jargonistas have taken over, and have learned to use language as a means of confusion rather than communication. Then when normalistas (you know, people who have consciences and think that words have meaing) encounter this nonsense and melt down in frustration, the jargonistas calmly look over their glasses, chide normal people for being stupidly ill-tempered, and call security.
We may finally have a weapon with which to fight back! Plain English! Laughter! It's the secret of Mel Brooks' genius--Blazing Saddles and The Producers are both great examples of Plain English humor.
If nothing else, it can help relieve the stress. Hells-bells, ever'body! When the Fed just got through printing up 1.2 trillion dollars out'ta thin air to buy up damn-near ever' mortgage in the country, then decides to throw another 800 billion on the fire, just fer good measure, ya just gotta laugh!
It may well all end in tears, but we gotta keep morale up, one household at a time, 'cuz life will have to go on, on way or t'uther.
Wednesday, October 27, 2010
OldSouth 's Economic Epiphany: DaFed Undertakes QE Round 2
Epiphanies arrive uninvited, unexpected, and sometimes resemble a good ole-fashioned slap upside da head.
Today's WSJ coverage of DaFed's newest effort to save civilization was one of those moments. An epiphany.
The Federal Reserve is close to embarking on another round of monetary stimulus next week, against the backdrop of a weak economy and low inflation—and despite doubts about the wisdom and efficacy of the policy among economists and some of the Fed's own decision makers.
The skies opened, the angels sang, the sun peeked above the eastern horizon, bathing OS in the light of revealed wisdom:
Damn! So THAT's how it's done! (Sound of palm slapping forehead in amazement.) I just sit at my computer, and CREATE money to go buy stuff with! Silly me...
Today's WSJ coverage of DaFed's newest effort to save civilization was one of those moments. An epiphany.
The Federal Reserve is close to embarking on another round of monetary stimulus next week, against the backdrop of a weak economy and low inflation—and despite doubts about the wisdom and efficacy of the policy among economists and some of the Fed's own decision makers.
The skies opened, the angels sang, the sun peeked above the eastern horizon, bathing OS in the light of revealed wisdom:
Damn! So THAT's how it's done! (Sound of palm slapping forehead in amazement.) I just sit at my computer, and CREATE money to go buy stuff with! Silly me...
Monday, October 4, 2010
Denninger And Charles Schwab Explain Why The Fed Is Corroding The Culture
Denninger points to a recent op-ed by Charles Schwab
The most striking quote to OS was this:
The Fed's super-loose policy has driven down the security and spending power of savers, particularly those in retirement who played by the rules during their working years and now depend on the earnings from their savings for a decent quality of life. As a result, savers and investors are being forced to take more risk with their money as they hunt for higher yields.
'The ones who played by the rules' for all those decades--the ones who stayed married, raised the kids, worked and worked and worked, often serving in the military (and sending their kids off to do the same), attended and supported their churches and synagogues, saved and scrimped and delayed gratification so they wouldn't be a burden to their kids in adulthood, to have something to spend on the grandkids, maybe even pay school tuition so the grandkids wouldn't have to go to public schools--those folks.
Those folks have been treated shabbily. They kept their money in CD's and Treasury securities, or in muni bonds, for safety of principal, for the insurance on their accounts. Now, not only have their income streams from the principal saved over the years dried up, but the value of those dollars themselves are now being deliberately eroded.
So, what does this mean for the culture? OS believes it breeds cynicism, and erodes hope. Virtue is its own reward, to be certain. Those folks who live virtuous lives have better lives than those who don't--such as meth addicts, to cite an extreme example. But if the end result of all that virtue and saving and investing is a worrisome old age of borderline poverty, it becomes more difficult to make the argument for virtue, thrift, ambition, self-improvement, etc. If the banksters always win, and are the only ones who prosper, the social glue of shared values begins to melt away.
OS listens to hip-hop urban radio a few times a week, not because he likes it, but because he wants to listen in on what is being said. It's not pretty. It is dark music and darker poetry, focused on raw materialism and hedonism, usually degrading to women, and always focused on short-term gratification. The sub-message seems always to be: What the hey, there is no future, and virtue is for chumps. Live for today, and for yourself.
Visit the neighborhoods from which this music emerges, and it is obvious the glue of shared values melted away long ago.
Unless we wish that cultural rot to spread, we would do well to pay attention. And we'd better be prepared to talk once again of virtue as its own reward. It will be a tough sell in this climate.
And, if you don't believe OS, or Charles, or Karl--then maybe Robert Reich will tell you what you need to hear. Same message, from a far different part of the ideological spectrum.
The most striking quote to OS was this:
The Fed's super-loose policy has driven down the security and spending power of savers, particularly those in retirement who played by the rules during their working years and now depend on the earnings from their savings for a decent quality of life. As a result, savers and investors are being forced to take more risk with their money as they hunt for higher yields.
'The ones who played by the rules' for all those decades--the ones who stayed married, raised the kids, worked and worked and worked, often serving in the military (and sending their kids off to do the same), attended and supported their churches and synagogues, saved and scrimped and delayed gratification so they wouldn't be a burden to their kids in adulthood, to have something to spend on the grandkids, maybe even pay school tuition so the grandkids wouldn't have to go to public schools--those folks.
Those folks have been treated shabbily. They kept their money in CD's and Treasury securities, or in muni bonds, for safety of principal, for the insurance on their accounts. Now, not only have their income streams from the principal saved over the years dried up, but the value of those dollars themselves are now being deliberately eroded.
So, what does this mean for the culture? OS believes it breeds cynicism, and erodes hope. Virtue is its own reward, to be certain. Those folks who live virtuous lives have better lives than those who don't--such as meth addicts, to cite an extreme example. But if the end result of all that virtue and saving and investing is a worrisome old age of borderline poverty, it becomes more difficult to make the argument for virtue, thrift, ambition, self-improvement, etc. If the banksters always win, and are the only ones who prosper, the social glue of shared values begins to melt away.
OS listens to hip-hop urban radio a few times a week, not because he likes it, but because he wants to listen in on what is being said. It's not pretty. It is dark music and darker poetry, focused on raw materialism and hedonism, usually degrading to women, and always focused on short-term gratification. The sub-message seems always to be: What the hey, there is no future, and virtue is for chumps. Live for today, and for yourself.
Visit the neighborhoods from which this music emerges, and it is obvious the glue of shared values melted away long ago.
Unless we wish that cultural rot to spread, we would do well to pay attention. And we'd better be prepared to talk once again of virtue as its own reward. It will be a tough sell in this climate.
And, if you don't believe OS, or Charles, or Karl--then maybe Robert Reich will tell you what you need to hear. Same message, from a far different part of the ideological spectrum.
Saturday, September 4, 2010
Ladeeezzzz And Gendlemun! Drum-Roll, Pleeze, For The Chart Of The Week!
Doug Ross shares it with us--a chart of the balance sheet of The Federal Reserve.
It states its figures in millions, so that means it holds about 1.2 trillion dollars in mortgage-backed securities. What could possibly go wrong?
OS drove through a very posh neighborhood of Nashville this afternoon on an errand. He's driven through that part of town for about forty years now. The 'for sale' signs are beginning to blossom, and one huge house, as yet unoccupied, goes to auction on September 10.
This in conservative Nashville, in the staidest neighborhood of the city.
Holy shit! Houses at auction? On Tyne Boulevard? This sort of event makes 1.2 trillion of residential real estate securities look like a really bad bet. Betcha the neighbors are crossing their fingers that bidders show up and bid it up to the five million the auctioneer is trying to flog it for.
Betcha he won't come close.
Ross links to a most erudite article, with its own series of sobering charts, well worth reading.
Hussman, the author, makes a cogent summation:
Good policy is not rocket science. It begins with the refusal to make people pay for mistakes that are not their own. This economy continues to struggle with a fundamental problem, which is that debt obligations exceed the ability to service them. While policy makers have done everything to preserve the patterns of spending and consumption that created the problem in the first place, we have done nothing to restructure those obligations.
It states its figures in millions, so that means it holds about 1.2 trillion dollars in mortgage-backed securities. What could possibly go wrong?
OS drove through a very posh neighborhood of Nashville this afternoon on an errand. He's driven through that part of town for about forty years now. The 'for sale' signs are beginning to blossom, and one huge house, as yet unoccupied, goes to auction on September 10.
This in conservative Nashville, in the staidest neighborhood of the city.
Holy shit! Houses at auction? On Tyne Boulevard? This sort of event makes 1.2 trillion of residential real estate securities look like a really bad bet. Betcha the neighbors are crossing their fingers that bidders show up and bid it up to the five million the auctioneer is trying to flog it for.
Betcha he won't come close.
Ross links to a most erudite article, with its own series of sobering charts, well worth reading.
Hussman, the author, makes a cogent summation:
Good policy is not rocket science. It begins with the refusal to make people pay for mistakes that are not their own. This economy continues to struggle with a fundamental problem, which is that debt obligations exceed the ability to service them. While policy makers have done everything to preserve the patterns of spending and consumption that created the problem in the first place, we have done nothing to restructure those obligations.
Friday, April 2, 2010
The Punch Bowl Is About To Be Taken Away: The Fed Meets Monday To Talk About Interest Rates
Denninger shares the news.
It was a former head of the Fed who said the crux of his job was 'knowing when to take away the punch bowl'--i.e. tighten down the money supply before inflation has a chance to take hold, or bubbles are created. One main means of doing this is to raise interest rates they charge to the banks they serve.
With a DJIA touching 11,000 with almost zero, zippo, nada in the real economy that normal humans live in justifying it, and ObamaCare about to suck up any spare dollar that isn't nailed down, it may be time to pack that sucker up, and send the partiers home to sober up. Is that black coffee we smell brewing?
It was a former head of the Fed who said the crux of his job was 'knowing when to take away the punch bowl'--i.e. tighten down the money supply before inflation has a chance to take hold, or bubbles are created. One main means of doing this is to raise interest rates they charge to the banks they serve.
With a DJIA touching 11,000 with almost zero, zippo, nada in the real economy that normal humans live in justifying it, and ObamaCare about to suck up any spare dollar that isn't nailed down, it may be time to pack that sucker up, and send the partiers home to sober up. Is that black coffee we smell brewing?
| Government in the Sunshine Meeting Notice |  |
| Advance Notice of a Meeting under Expedited Procedures | ||||
| It is anticipated that a closed meeting of the Board of Governors of the Federal Reserve System at 11:30 a.m. on Monday, April 5, 2010, will be held under expedited procedures, as set forth in section 26lb.7 of the Board's Rules Regarding Public Observation of Meetings, at the Board's offices at 20th Street and C Streets, N.W., Washington, D.C. The following items of official Board business are tentatively scheduled to be considered at that meeting. Meeting date: April 5, 2010 <!-----------This is the bordered table------------------------->
| ||||
Friday, January 15, 2010
Time For Sheila To Pay A Visit To Ben?
Let's say I've got me a bank, and I decide to leverage up 43-to-1 on residential mortgages of uncertain quality. Let's also say I've decided to diversify, and have me a printing press in the garage out back, churning out perfect $100 bills every day.
Betcha' Sheila Bair's crew from FDIC will pay me a visit some Friday afternoon, and tell me to hand over the keys and go home, 'cuz my bank has been seized by the guv'mint. And, by the way call my lawyer, 'cuz I'll be needing him.
Jesse Felder points out that this is what the Fed has done, by purchasing nearly a trillion dollars of mortgaged-back securities, bought with freshly minted money.
Hmm...
Here's his chart, just for grins.
Betcha' Sheila Bair's crew from FDIC will pay me a visit some Friday afternoon, and tell me to hand over the keys and go home, 'cuz my bank has been seized by the guv'mint. And, by the way call my lawyer, 'cuz I'll be needing him.
Jesse Felder points out that this is what the Fed has done, by purchasing nearly a trillion dollars of mortgaged-back securities, bought with freshly minted money.
Hmm...
Here's his chart, just for grins.
Saturday, January 9, 2010
'Scuze Me, But We Seem To Have Misplaced...
528 billion dollars.
The US government sold a whole boatload of debt last year, and inquiring minds looked on in some real amazement as each auction went off without a hitch.
So they kept on inquiring, and noticed something worthy of inquiry in the 2009 auctions:
No one seems to know who bought some 520 billion dollars worth of government debt.
It wasn't foreign interests. They bought the biggest block, nearly 700 billion dollars worth.
Then there is The Fed, who bought some 286 billion.
Then there is the amorphous 'Household Sector', who account for some 528 billion dollars.
But, it's not clearly defined who the 'Household Sector' actually is, and that's what inquiring minds want to know. $528 billion is still a lot of money, even here in the Land of Hope and Change.
So, if you trip across it, make sure you let the proper folks know. They might be missing their 528 billion in T-Bills. I know I sure would.
The US government sold a whole boatload of debt last year, and inquiring minds looked on in some real amazement as each auction went off without a hitch.
So they kept on inquiring, and noticed something worthy of inquiry in the 2009 auctions:
No one seems to know who bought some 520 billion dollars worth of government debt.
It wasn't foreign interests. They bought the biggest block, nearly 700 billion dollars worth.
Then there is The Fed, who bought some 286 billion.
Then there is the amorphous 'Household Sector', who account for some 528 billion dollars.
But, it's not clearly defined who the 'Household Sector' actually is, and that's what inquiring minds want to know. $528 billion is still a lot of money, even here in the Land of Hope and Change.
So, if you trip across it, make sure you let the proper folks know. They might be missing their 528 billion in T-Bills. I know I sure would.
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