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Thanks guys!!

*seething rage*

And this is only the tip of the iceberg, I am sure it gets worse. It is already bigger and badder than I have imagined.

Whoa, I guess this explains one of the big US banks selling my mortgage to Fannie Mae. Should I be worried about that?

The Fed Fucked us.

The Fed is a group of private bankers and not a government entity. They look after themselves not the citizens of America

Let the USA print their own money supply as per the constitution.

>> ^bobknight33:

The Fed Fucked us.
The Fed is a group of private bankers and not a government entity. They look after themselves not the citizens of America
Let the USA print their own money supply as per the constitution.


Nobody owns the Fed. It's not just "some other private business". It was created in 1913 by law. Their powers are exclusive and granted by congress. In fact, according to most constitutional scholars, the government is not given the power to give powers they don't have to someone else. That would make them all powerful and defeat the purpose of the document. Remember, the constitution is a privilege system. Whatever isn't explicitly granted to the government is implicitly denied. Article I does not say that the government can print money, it says it can coin money. That wording was used at a time when government notes not backed by metal had just blown up in everyone's face. And if the government can't print money, what gives them the authority to create a virtual GSE that can? Somehow, the government got around that article by endowing a bunch of powers it didn't have to a "private" entity, continuing to call it private, and going from there. It doesn't make sense to anyone with a brain, but to a dumbfuck populace, it's plenty complex to achieve subversion. Government have always wanted to spend as much of the people's money as they can without eliciting the resistance of taxation. And inflation is what allows them to do it.

We don't want currency to be counterfeited by its issuer while everyone else has to produce to obtain it. That's the purpose of having 100% gold-backed notes in milligram denominations. The scarcity of gold cannot be reduced like a dollar unit. If the Fed started issuing denominations with extra zeroes, any dollars you hold buy 10% what they did before. They print money, buy government bond debt, and by the time it filters down to you, prices have gone up.

$290B to Deutsche Bank in exchange for junk ... bwahahaha, Ackermann (CEO of Deutsche Bank) is fucking everybody. He's running the show over here as well, all financial decisions seem to need his approval.

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@BansheeX I think anyone who promotes the idea of a return to a gold standard has to realize that deflation is just as bad, if not worse than inflation.

What we're seeing right now in the economy is the effect of mere disinflation (i.e. a drop in the rate of inflation), and the result is lots of unemployment, and very low investment in actual economic activity because it's far too attractive to hoard cash (or more accurately financial assets so safe they're as good as cash).

Part of how you break out of that cycle is to create an expectation of inflation, and you have no hope of that under a gold standard, because you can't increase the money supply. In fact, you're guaranteed to see a steady rate of deflation whenever your population grows, or your economy tries to expand and that will put a drag on growth.

I don't think there's much of a case to be made that the Fed is unconstitutional (and what case there is rests on the word "coin" carrying a lot more weight than the phrase "regulate the value thereof" which follows it). Even if some SCOTUS ruled it unconstitutional, you'd see an amendment to the Constitution passed before you can say the phrase "the Senator from Goldman Sachs". Like Cenk said, our government is nothing but quick and efficient when it comes to serving the interests of the rich and powerful.

Which ultimately is what I think Cenk said that carries the most weight -- the problem isn't that the Fed exists and has the power to do things like this, it's that the actions it takes are quick and decisive when banks and investors are in trouble, but regular people not so much.

In this case, the Fed bought a lot of toxic assets at face value. I like this a lot more than Congress authorizing treasury to do the same thing, because unlike Treasury and Congress, the Fed can just print the money rather than borrow it. We don't have to pay interest on those dollars to anyone, and we don't need to collect them back with taxes, either. We might see inflation, but right now inflation would be good for the economy.

What the Fed could have done instead is print up money and give it to people to pay off their mortgages. In effect it could still do this by just writing off the toxic assets it holds, and not foreclosing on the mortgages it has on its balance sheet. It may still do this, and I suspect it will have to for some percentage of them. I also expect right-wing people to bitch about "moral hazard" and lazy parasites mooching off the producers in society if/when it happens.

Ultimately, the only downside to any of what the Fed is doing is that it might lead to inflation. But so far nothing it's done has created even the slightest increase in the year-over-year inflation rate, which is already well below the 2% target. Furthermore, all market indicators are predicting inflation of essentially 0% as far out as 7 years, even though the scale of the Fed's actions are public knowledge.

I feel like I need a degree in economics to know which side is full of shit. Because one of them has to be.

I guess the real question is, at what point will inflation collapse the house of cards? Or can we have a 2% rate of inflation indefinitely?