Busted: Bankers and The Global Economy

October 15, 2010

US Inflation Not High Enough Says Bernanke

Wages are stalled, job numbers are anemic, prices are up and social security payments are frozen. The Fed’s policymaking committee “is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation over time to levels consistent with our mandate.” Apparently, action is needed, even though Bernanke is speaking in yesterday’s terms.

According to Bernanke, current inflation numbers are well below the Fed’s objective of 2%. He is worried about deflation caused by printing dollars. Now the Fed will print more dollars and buy securities on the back end in a sort of mock economic transaction. Inflation and Fed profits are the main concern. Inflation allows central bankers to take an additional cut of economic life blood for their services.  In the past, Bernanke has tried upselling to Wall Street. Today, many news articles are claiming that the Fed plans to tame inflation.  He expects to create inflation, but does the Fed have the control it needs to regulate that inflation?  Bernanke thinks so. Bernanke claims to believe that the Fed’s intervention will stimulate the economy, reduce unemployment and prevent deflation. Clearly, the Fed thinks they are large and in charge. This comment and others were made to show intent about “avoiding a double-dip recession.”

Chairman Ben Bernanke said this morning that the Federal Reserve is prepared to take new action to boost the economy.  Inflation has been too low of late and unemployment is poised to come down too slowly. They intend to create inflation. Are you ready for the fallout?

Meanwhile in the United Kingdom, Justice Minister Ken Clarke warned that world is “in grave danger of financial collapse.” He warned that western nations are “not out of the woods yet”…”We have rescued ourselves for the moment from being bracketed with the weaker brethren with doubts about our credit rating and the costs of our borrowing, but if we fail to deliver the kind of program we have set out we will be back there all too soon if we are not too careful.”  Clarke’s comments come only six days before the coalition government’s massive spending cuts are announced. The U.K. government argues that the cuts are necessary to restore the economy to health. Opponents claim they will push the U.K. into a double-dip recession.

 

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April 16, 2010

Video: Holding Wall Street Accountable

President Obama is selling the strongest consumer protections ever, bringing transparency to financial dealings. He suggests closing loopholes to stop recklessness and irresponsibility and to hold Wall Street accountable while giving shareholders new power in the financial system. President Obama lays out what Wall Street Reform is about, and questions whether opposition from the Senate Republican Leader might have something to do with his recent meeting with Wall Street executives.

July 7, 2009

Pope: Economy Needs Ethics

Without internal forms of solidarity and mutual trust, the market cannot completely fulfill its proper economic function. And today it is this trust which has ceased to exist, and the loss of trust is a grave loss.” According to the Vatican, the economy needs ethics in order to function correctly, just as the implementation of ethical financing and systems of micro-credit and micro-finance indicate. In development programs, the principle of the centrality of the human person must be preserved, while international organizations might question the actual effectiveness of their bureaucratic and administrative structure. This is one of the central messages of Benedict XVIs new encyclical Caritas in Veritate that was published July 7th and signed by the Pope. If you have been following this blog, you know what is up right now. I don’t need to say another word. ~ E. Manning

July 3, 2009

U.S. Banks, Economy Continue Up in Smoke

Filed under: banking, economy, money — Tags: , , , , , , , , , , , , , — digitaleconomy @ 10:28 am

economic fire sale

economic fire sale

Even though this website hasn’t been dwelling on bank closures lately, the number of bank closures is definitely on the increase. In anticipation of the holiday weekend, seven U.S. banks have been closed, bringing the total of banks closed this year to 52.

What has made the closures this week unique is that many of the banks have been financially interlinked, which has exposed them to closure because of CDOs and loan losses. Local banks, not too large to fail, have been hit especially hard during the economic crisis, as a drop in home values has devalued mortgage-backed assets. The rising unemployment numbers have also impacted the banks, as more consumers are defaulting on their loans.

What really highlights the current economic crisis to me was a visit to a large retailer yesterday. I spent an hour in the store and as I shopped, I heard all manner of phone conversations and scuttlebutt between employees about the economy, economic failure, job losses and financial family crises. This snapshot in time on a Thursday afternoon would seem to indicate that the nation is enduring some uncommon suffering as you read this commentary. While I was shopping, I wasn’t looking for what I discovered. The conversations, many of them quite loud, were impossible to ignore. ~ E. Manning

June 24, 2008

Fed Interest Rate Responsible for Inflation?

The joke of the day is CNN money’s recent article ruminating about the effect of the Federal Reserve’s low-interest rates and the creation of inflation. Low-interest rates for bank have helped the bottom lines of financial institutions. Consumers and investors have experienced little, if any, benefit.

According to the article, some think that low interest rates are at least partly responsible for some of the serious drags on the U.S. economy today, such as soaring prices of food and gas and the weak dollar. The interest rate of the Fed have nothing to do with such things at this low level of interest!

The country is fighting on two war fronts in Iraq and Afghanistan. Credit and monetary funding has been issued by the Federal Reserve on record levels. The national debt has grown exponentially since President Bush took office, which is probably his greatest legacy. The constant creation of monetary credit has thoroughly devalued the dollar in relation to the rest of the world. As a result, costs are higher. Capital value in the real estate market and economic pressure on the cost of goods continues to drive values down. This results in a contraction of the marketplace.

Wall Street and the media need to grow up. Sour grapes during tough times among people with most of the power and influence is ridiculous. Wall Street continues to find ways to make money. Scapegoating for their own benefit is exactly the situation. If you have read the information on this website, you know why the economy is in the dumper: financial and banking greed.

Most economists think inflation is here to stay. It’s likely to get worse.

May 15, 2008

U.N. Says World Economy on Brink

The U.N. says the world economy is “teetering on the brink” of a severe downturn.

The U.N.’s mid-year economic projections blamed the downturn on further deterioration in the U.S. housing and financial sectors in the first quarter. The U.N. said the U.S. problems are expected to continue to be “a major drag for the world economy” into 2009.

Looking beyond the financial and housing market, you can find strength. Consumer staples and energy are economic hot spots right now. Whether these hot spots are really good for the economy or not, in times of prosperity and decline, investors can always find a way to make a buck.

The United Nations is really good at spending other peoples’ money. Naturally, they are very concerned during a global downturn because money is harder for them to get.

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