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On August 27, 2010 in a much Ballyhooed Speech at Jackson Hole, Bernanke said
Really?!
In light of yesterday's FOMC Statement inquiring minds are asking four key questions.
1. Did the economic conditions "deteriorate significantly"?
2. Is deflation a significant risk?
3. Does the Fed "have the tools"?
4. Did the Fed do a "careful comparison of benefit and cost" for further quantitative easing?
Answers
Go to link for rest of the article
The Committee is prepared to provide additional monetary accommodation through unconventional measures if it proves necessary, especially if the outlook were to deteriorate significantly.The issue at this stage is not whether we have the tools to help support economic activity and guard against disinflation. We do. As I will discuss next, the issue is instead whether, at any given juncture, the benefits of each tool, in terms of additional stimulus, outweigh the associated costs or risks of using the tool.The FOMC will strongly resist deviations from price stability in the downward direction. Falling into deflation is not a significant risk for the United States at this time, but that is true in part because the public understands that the Federal Reserve will be vigilant and proactive in addressing significant further disinflation. It is worthwhile to note that, if deflation risks were to increase, the benefit-cost tradeoffs of some of our policy tools could become significantly more favorable.The Federal Reserve is already supporting the economic recovery by maintaining an extraordinarily accommodative monetary policy, using multiple tools. Should further action prove necessary, policy options are available to provide additional stimulus. Any deployment of these options requires a careful comparison of benefit and cost.
In light of yesterday's FOMC Statement inquiring minds are asking four key questions.
1. Did the economic conditions "deteriorate significantly"?
2. Is deflation a significant risk?
3. Does the Fed "have the tools"?
4. Did the Fed do a "careful comparison of benefit and cost" for further quantitative easing?
Answers
Go to link for rest of the article
1 comment:
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Our economy is slowly dying, it is kept alive artificially. No one is proposing a solution because no one has the slightest idea of why it is happening and many have vested interest in the present system. However an objective observation of the phenomenon can help us understand it and provide us with an innovative solution. Of course we can't solve the problem with the tools that brought us there in the first place and we need a new ideology.
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- Do you feel that your ideology pushed you to make decisions that you wish you had not made?
- Well, remember that what an ideology is, is a conceptual framework with the way people deal with reality. Everyone has one. You have to -- to exist, you need an ideology. The question is whether it is accurate or not. And what I'm saying to you is, yes, I found a flaw. I don't know how significant or permanent it is, but I've been very distressed by that fact.
- You found a flaw in the reality...(!!!???)
- Flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak.
- In other words, you found that your view of the world, your ideology, was not right, it was not working?
- That is -- precisely. No, that's precisely the reason I was shocked, because I had been going for 40 years or more with very considerable evidence that it was working exceptionally well.
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In order to alleviate those economic woes wee need to create, as fast as possible, a new credit free currency that will solve the credit crunch and bring incremental jobs, consumption and investments to the present system.
An Innovative Credit Free, Free Market, Post Crash Economy
A Tract on Monetary Reform
It is urgent if we want to limit social, political and military chaos.
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