Fed Whisleblower - Backdoor Bailout Biggest Of All Time

[lektrode]

Re: Fed Whisleblower - Backdoor Bailout Biggest Of All Time

Originally Posted by GRG55 Deflation...Fed style. From the Ritholtz blog:






I can't stop laughing at this. What's next? The Fed seeing how far it can toss the dwarf economy?

+1
hell if i know, all eye do know is this one = why i keep coming back here...

[Master Shake]

Re: Fed Whisleblower - Backdoor Bailout Biggest Of All Time

Link?

[Thailandnotes]

Re: Fed Whisleblower - Backdoor Bailout Biggest Of All Time

http://www.ritholtz.com/blog/category/humor/

[Forrest]

Re: Fed Whisleblower - Backdoor Bailout Biggest Of All Time

I can't agree.

Seems to me we have an example of avoidance of QE (for the most part) in the policies of the ECB, to compare against the QE policies of most of the other major Central Banks.

And the end result appears to have been a requirement for more immediate bail-ins, extra-ordinary unemployment levels, collapsing economies, increasing economic migration outside the Eurozone, the liquidation of public assets at fire-sale prices, rising public debt levels (which are increasingly unserviceable) and a rending of the social and political fabric of Europe that risks creating permanent rifts between nations (the UK's shrill debate about leaving the EU one of the more prominent examples).

As EJ has pointed out numerous times, it is preferable to avoid the policies that promote the bubbles and the excessive speculation driven debt increases on the back of fictitious asset valuations. But history demonstrates, repeatedly, that the public, individual household and corporate sectors all seem utterly incapable of that. Anywhere. Although somewhat less indebted than most of its EU neighbours or the USA, Germany is hardly a paragon of virtue in terms of controlling it's own public debt through this episode:


Once the asset bubble(s) burst, and the debt is revealed as excessive it would seem applying a bit of all three remedies may be better than an excessive dependence on just one of these:
- austerity to reduce or stop the rate of new debt build up;
- deliberate inflation to gradually reduce the real cost of the debt;
- voluntary or involuntary debt forgiveness (workouts with writedowns, defaults).





Increase your savings and reduce your consumption, because in a truly deflationary world "Cash is King", and whatever you want to purchase will be cheaper tomorrow...

Thanks...I am grateful to know I am headed in the right direction.

[Master Shake]

Re: Fed Whisleblower - Backdoor Bailout Biggest Of All Time

Ha! That's pretty good.

[aaron]

Re: Fed Whisleblower - Backdoor Bailout Biggest Of All Time

excellent post