I enjoyed him grilling Bernanke , but this just seemed like self congratulatory non-sense, I thought I was watching Micheal Moore. Anyone else get the same sentiment?

HollywoodBob -- that's the same fallacy that Grayson brings up, and Bernanke addresses -- the credit swap with foreign banks did not affect credit availability for Americans

Ben Bernanke has quite a bio for himself too. I'm sure if these two guys worked together, a lot of problems could be solved.

Your video, Congressman Alan Grayson laughs in Ben Bernanke's face, has made it into the Top 15 New Videos listing. Congratulations on your achievement. For your contribution you have been awarded 1 Power Point.

^Bernanke is calling it a swap, but it's a loan. We give them money in the form of dollars, and they pay us back with interest in their currency, assuming they ever have the means to do so. The problem Grayson is having with it is in the insanely massive amount of money given out, at a time when the US really can't afford to be giving out that kind of money. 500 billion dollars to foreign nations works out to about 1700$ per person in America. Couldn't you use an extra 1700$ right about now?

I'm confused. Grayson (as well as the video description) calls this "lending" several times, but from what Bernanke said, it seems to be a currency swap.

European bank has euros, needs dollars. US bank has dollars. European bank buys dollars for euros. Both banks remain at the same balance as before.

That's how I understood it. Am I wrong?

>> ^marinara:
1. You can't say that doing nothing is what we got Hoover to do.

I didn't say that doing nothing is what "you" (meaning Austrian Economists, apparently) got Hoover to do. I said getting Hoover and Mellon to let banks fail, balance budgets, and adhere to the gold standard are what "you" got Hoover to do, and what Austrians are calling for Obama to do.

2. Hoover provided loan guarantees to the banks just like Obama/Bush
3. Hoover pledged public money towards building projects
4. Hoover made business leaders pledge to keep employment high
5. Hoover created the Reconstruction Finance Corporation to lend money and unfreeze the credit markets.

He did all of that in 1932, and not on the scale needed. Not every ounce of what Hoover did was wrong, nor was every ounce of what Roosevelt did right.

6. Hoover made the depression worse by tinkering with interest rates and taxes.

Oddly nonspecific what you say there with "tinkering". Hoover/Mellon raised interest rates and taxes. Obama/Bernanke cut them.

There is no rule, that says you always boost the monetary supply in recessions. Is there?

Actually, that is the short-form advice of mainstream economists. There is quite a long list of exceptions to the rule, though none apply right now.

Are all economic challenges the same? No!

I'm not saying they're all the same, but there's a lot about the current economic crisis that's very similar to the Great Depression.

Why is it so hard to believe the words in this video?

Because it's internally inconsistent, and cherry-picks facts around an obvious political agenda!

Is it so hard to believe that the Fed is operating on policies that benefit the few people who actually own the Fed?

Actually, no. But not all anti-Fed propaganda is created equal. Saying "Goldman Sachs got a sweeter deal from the Fed from anyone else because they have close ties to the board of governors" I believe.

Saying "the Fed destroyed the global economy on purpose, at least twice for private gain" requires a leap from the tenuous argument that the Fed caused both depressions (I'm not sold on the Great Depression, and I vehemently disagree about today's depression), to the Fed intentionally caused both for the economic gain of some small set of people.

Actually, it's pretty funny to me how he essentially says that the problem was that the Fed contracted the money supply in response to a crash. That's exactly what the Keynesian and Monetarist schools believe.

I also like how at 9:20 or so he says "the biggest gains happened when the National Recovery Act was overturned" well skippy, the National Recovery Act was trying to stop deflation by fixing prices. Not a good idea, definitely a drag on the economy, and not a part of the New Deal liberals want to repeat. He then says the "Agricultural Adjustment Act" (aka a farm subsidy bill) was struck down in 1936, and boom, growth immediately falls off (according to the chart), though his narrative blames that on the institution of the NLRA, which still exists today, and just protects the rights of workers to organize Unions.

What really cause the fall off was that Roosevelt was persuaded to believe that the depression was over, and it was time to cut spending, raise taxes, and balance the budget. Doing so immediately sent the economy crashing down again.

He also uses some voodoo to leave you thinking that because Obama thinks fiscal stimulus will help (and it did, even this video states that the economy recovered when the giant government stimulus of WWII began), he will somehow order the Fed to contract the money supply too. One, he can't, and two, we learned our lesson -- you need to expand the money supply in downturns, otherwise it chokes off the recovery. Bernanke is expanding the money supply.

He also defiantly ends with "it was not the free market and the gold standard that caused the problem", he's half right. With regard to the Great Depression, they were contracting money supply to get back onto the gold standard, and refusing to bail out the banks, which made a recession into a depression (not the free market). This economic problem was caused by the free market, and but Austrians cry out for a return to the gold standard, and that we let the banks fail.

We did it the classical/Austrian way in the 1930's, and it caused the Great Depression. Now you want us to do the same things you wanted (and got) Hoover to do, and got Roosevelt to do in 1937. Forget it.

>> ^robdot:
my friends. this guy is hopelessly out of touch. hes living in the 1920;s or something. if the usa was the size of texas maybe we could live the way he proposes, but we are 300 million strong. we must feed and protect 300 million people. we need desease control. emergency management. protection of our food supply.
we can not survive.literally,without the fda cdc fema etc. also without a progressive income tax the wealth would quickly be in the hands of a small percentage of the population. no matter what anyone says our tax system helps to ..spread the wealth. fair tax, flat tax. sales tax. etc. are regressive. the more you make the less you pay in taxes. thats why we dont do that. this guy is one of the reasons we are so fucked up right now. hes completely lost.


Um, your country survived for more than half it's existence without those services. You also survived without the income tax until 1913! Also, an unapportioned tax on income is actually unconstitutional.

Also, regarding the income tax spreading the wealth around, perhaps some numbers might convince you otherwise:


In the United States, wealth is highly concentrated in a relatively few hands. As of 2004, the top 1% of households (the upper class) owned 34.3% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.3%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth minus the value of one's home), the top 1% of households had an even greater share: 42.2%. - Source

Ron Paul is on the side of individuals making decisions for themselves. The CDC, FDA and FEMA don't feed 300 million people, individuals work and receive money that they buy food with. The government does not contribute at all, except taking a percentage of that individuals earnings in tax and spending it on government programs.


>> ^chilaxe:
Paul's and Schiff's prediction of the end of civilization as we know it unless we all become fans of freshwater economics doesn't look very likely. They better hope for something like a meteor strike to help bring civilization down, because it's a drain on your credibility if your 100% certainty predictions don't pan out.


In comparison with the people who are actually in control of the economy, Schiff and Paul have been right 100% of the time. If anyone's credibility should be questioned, it should be Bernanke and Geithner.

>> ^blankfist:
What. The. Fuck. The currency's value is driven specifically by its supply. Never in history has it not. In any economy! Stop spreading your partisan misinformation, please!

Okay, deep breaths. Reread what I said that followed the portion you quoted. Read (or reread) the article marinara linked.

Back? Awesome. Now, say I can buy a loaf of bread for $1 today. Let's say after the store closes, the Fed "prints" enough money to double the money supply, gives it to banks, and the banks say "just put it on our account and keep it in your vault, we don't wanna lend that out right now". So the Fed just carts it from the printers to their vault.

Will a loaf of bread cost $2 when the store opens the next day?

Bonus question: Will a euro cost me twice as much that next morning, as soon as the exchange hears about what the Fed's done?

Because Austrian economics is just libertarianism? Well, in that case, I'm glad you recognize people like Thomas Jefferson to be Libertarian in nature. Though, I doubt you could consider Andrew Jackson, the racist father of your Democratic party, to be Libertarian. Obviously neither studied Austrian Economics, but both were adamantly against a centralized bank system. What does that do for your bullshit hypothesis that Austrian Economics is thinly veiled Libertarianism? Probably nothing good, right? Yeah, what I figured.

Okay, let me walk through your reasoning here. You're saying Thomas Jefferson and Andrew Jackson are neither libertarians, nor Austrians, but were anti-central bank. This disproves my theory that Austrians based their theories on axioms designed to support libertarian ideology how?

Here's how you'd go about proving me wrong: name one government policy that Austrian Economic theory recommends that libertarians and anarcho-capitalists would disagree with.

Actually, being against an elitist, big money, powerful central bank is not an idea solely indicative of Austrian Economics. It's a universal idea most agree with... except those who tow their Democratic party lines so blindly and carefully.

There are plenty of people who might disagree with something the Fed's done, or give a negative job rating for the Fed at any given time, but that's different (as in the difference between saying "I hate what Obama's doing" and "I want to eliminate the Presidency entirely"). I think a far more accurate statement would be that most people have no clue what the Federal Reserve is or does -- I'd be shocked if even 20% could accurately tie it to money supply or interest rates.

I want to see some polling backing up your overtly partisan claims. I'd say the number of people who actively want the Fed abolished utterly is pretty small, and tightly linked to the number of people who're blind followers of fans of Ron Paul.

>> ^gtjwkq:
Oh yes, Bernanke is definitely a genius and has been right so often that whatever he predicts must come true one way or another.

Who said that? Certainly not me.

Other people are making that assertion about Schiff though, which is just as silly as someone attributing superhuman powers to Bernanke.

All I said was that Bernanke has tremendous credentials in precisely the area that matters for being a Fed chairman during a Great Depression-style crisis. That doesn't mean he's incapable of making mistakes (or just being plain wrong), it just means he's less likely to utterly screw the pooch on the narrow topic of monetary policy than most people.

>> ^NetRunner:
^ A currency's value is determined by what it can buy, not based on how much of it there is in existence.

What. The. Fuck. The currency's value is driven specifically by its supply. Never in history has it not. In any economy! Stop spreading your partisan misinformation, please!



>> ^NetRunner:
^ ...and Bernanke is one of the top minds on that subject.

For that statement, you should be punched in the dangles while QM sucks you left and right, holmes.



>> ^NetRunner:
^...Austrian economists like Schiff believe a different story. Mostly the theory is that what I said is quackery, and that any meddling by a central bank will cause more problems than it solves. Why? In my opinion, that's because Austrian economics is just libertarianism dressed up to look like an economic theory, and they don't like that both mainstream schools believe that central banks perform an important role in the economy.

Because Austrian economics is just libertarianism? Well, in that case, I'm glad you recognize people like Thomas Jefferson to be Libertarian in nature. Though, I doubt you could consider Andrew Jackson, the racist father of your Democratic party, to be Libertarian. Obviously neither studied Austrian Economics, but both were adamantly against a centralized bank system. What does that do for your bullshit hypothesis that Austrian Economics is thinly veiled Libertarianism? Probably nothing good, right? Yeah, what I figured.

Actually, being against an elitist, big money, powerful central bank is not an idea solely indicative of Austrian Economics. It's a universal idea most agree with... except those who tow their Democratic party lines so blindly and carefully.

Oh yes, Bernanke is definitely a genius and has been right so often that whatever he predicts must come true one way or another.

Ben Bernanke: wrong, wrong, wrong, aaaaand wrong again

Everything is fine, the worst of the recession is over you guys, nothing to see here

^ A currency's value is determined by what it can buy, not based on how much of it there is in existence.

The two are related of course, but the way you devalue the dollar is to see prices increase because there's enough "extra" money circulating in the economy to drive prices up.

Generally speaking when you have companies slacking off production, and laying off workers "extra money" won't increase prices, instead it's likely to drive demand back up, and get those idle resources to be employed again.

Eventually you will need to worry about the extra money causing inflation, but only once the economy has gotten into a solid recovery. At that stage you want to start contracting money supply again, and get things back into a general equilibrium.

Most modern economic theory is geared towards trying to find accurate tools for judging when and at what speed the Fed should do such a thing, and Bernanke is one of the top minds on that subject.

I suppose I should add the caveat that that's just what mainstream economists believe, Austrian economists like Schiff believe a different story. Mostly the theory is that what I said is quackery, and that any meddling by a central bank will cause more problems than it solves. Why? In my opinion, that's because Austrian economics is just libertarianism dressed up to look like an economic theory, and they don't like that both mainstream schools believe that central banks perform an important role in the economy.

I guess my point is that we at least try not to just slap the lies channel on everything we personally disagree with. During the election there was quite a run of people slapping the lies channel on any clip where people said something they disputed (regretfully, I was guilty of that too from time to time).

I don't think this clip qualifies, even if 30 years from now the consensus decision of history is that Bernanke was a crook who bailed out the banks to enrich his friends, and the economists universally agree that no bank should have been bailed out.

Maybe if this had been some big policy speech that changed the nature of the debate on a false premise (a la Bush's 16 words), but this is a snoozer where there's a chance that a political leader is bending the truth to deny culpability for a problem, or overstate the purity of their motives.

If that's the standard, we may as well mass-change all politics videos to include the lies channel.