World Needs Permanent QE - Says AEP -

[aaron]

Re: World Needs Permanent QE - Says AEP -

Morgan Stanley's Tax Credit harvesting machine is call 10,000 Small Businesses - http://www.goldmansachs.com/citizens...businesses/US/

The bankers will take their cut no matter what. If 10,000 small businesses will be funded, perhaps 500 will be successful and "produce" jobs. Something will exist at the end.

[Polish_Silver]

Greenspan vs Yellen

Volker and Greenspan didn't have to answer to a Political Machine that generates campaign donations and support of grassroots political action
. . .

The organization Ms Yellen was visiting is called Connect and one of Connects partners/supports is a little ole non-profit called LISC
. . . .

Yellen was doing an appearance for very powerful interest groups who are closely aligned with Big Banks and the Obama Administration. . . .

Greenspan seemed completely "owned" by Wall Street, regardless of method.

All we have on Yellen is "visiting Connect" and "doing an appearance" for "powerful interest groups". That isn't much of a scandal in my book. I'm still hoping she's a good guy.

[Polish_Silver]

Re: World Needs Permanent QE - Says AEP -

Can you point to an instance of Volcker or Greenspan engaging in this shaking hands and kissing babies variety of campaigning that is clearly intended to convey that the Fed cares about working families? H

Since the TARP, many people feel that the fed is working for the banks. Therefore, the FED must make extra effort to seem to be working for "mainstreet". That was Bernanke's word on his TV interview. Bernanke did quite a lot of showmanship, giving introductory lectures in economics, etc.

[verdo]

Re: World Needs Permanent QE - Says AEP -

Well researched. So it was a twofer: suck up to FIRE interests while appearing to be an advocate for the poor. She didn't get where she is by being politically naive.

Indeed

[vinoveri]

Re: World Needs Permanent QE - Says AEP -

AEP is the epitome of a sycophant lackey for the status quo - absolutely incredible! keep telling a lie and it becomes believed as truth

http://www.telegraph.co.uk/finance/c...g-society.html

It is true that Japan is struggling despite the most radical QE blitz ever attempted in a large economy - roughly $70bn a month since Shinzo Abe took power, and began to shake Japan out of its fatalism - but it had a bigger mountain to climb, and it has in fact weathered the shock of its sales tax rise this year. Those who say QE has failed in Japan are premature, and offer no counterfactual argument. [yeah, I guess 20 years isn't long enough) Clearly the status quo ante was a path to ruin.
You can argue that zero rates robbed savers, and that QE robbed them a fraction more, but let it never be forgotten that the state rescued the banking system [Correctamundo!]across much of the industrial world in 2008. If governments had let banks collapse - and 4,000 went under across the US in the early 1930s - savers would have lost their shirts [Blatant misrep - FDIC would have kicked in]. They were in fact bailed out by the taxpayers, and little gratitude some show for it.
What QE has done is to distribute the costs of crisis evenly between creditors and debtors, a matter of natural justice. {i'm speechless; does this guy really believe this? A matter of "natural justice" no less - OMG!!] Eurozone policies are by contrast an enforcement mechanism for creditors alone. Debtors in Spain have been reduced to servitude by a combination of medieval debt laws and the "internal devaluation" imposed by the EMU regime.
We will never know whether extreme monetary stimulus averted social and political breakdown, a slide into beer-hall thuggery and street militias, but would you ever wish to put the matter to a test? So let us give due credit to the heroes of our time - Ben Bernanke, Mervyn King and those who stood by them against the mob of howling critics. I suppose he gets to keep his inside access to the CB and get invited to Davos and Jackson Hole after this all in butt kissing

[Polish_Silver]

QE for the masses !

Can you point to an instance of Volcker or Greenspan engaging in this shaking hands and kissing babies variety of campaigning that is clearly intended to convey that the Fed cares about working families? Hard to square that with the stated goal of QE, to inflate asset prices on the balance sheets of high net worth families.

I thought EJ had some data that equities were much more broadly owned, and that the
recent "growth" was due to the net worth of the middle class being pumped up by
equity markets. If I remember right, the fat cats sold off around fall 2008, and middle class suckers (like myself) replaced them.

[don]

Re: QE for the masses !

Jesse on the Japanese plunge . . .

For Whom Are the Japanese Leaders Kuroda and Abe Making Their Monetary and Fiscal Policy?


The expansion of the BOJ asset purchase program was timed to start with the end of the Fed's asset purchase program. I mean, come on. Could it have been any more obvious?

There is no big question that the Bank of Japan has been acting in concert with the Fed for the better part of this century at least. And politically, Japan is a client state of the US.

And reader know that I have a long standing observation that one of the great difficulties in recovering from the long period of Japanese economic stagnation since the collapse of their great real estate and stock market bubble has been the inability to clean up their interlocking financial system dominated by industrial combines called keiretsus and a closely associated political system run by a surprisingly well connected minority of insiders.

Beyond that I wondered why was Japan pursuing the purchase not only of domestic equities and non-sovereign paper, but foreign equities as well with their very large pension fund? Are these intended as 'investments?' Or are they a form of cross subsidies in support of a more global agenda?

It makes me wonder if the policy being pursued by the BOJ is not designed to help the people of Japan now, so much as to support the requests of the international banking concerns, more specifically the US Federal Reserve.

This made me wonder if Kuroda is pursuing the same type of trickle down stimulus in buying large amounts of financial paper by printing money, rather than engaging in policy actions to stimulate aggregate demand.

And there is that nasty consumption tax hike in April which tends to have a regressive effect on lower income households. A weak yen is good for the exporters and multinationals, but is hard on small businesses and consumers.

Although the Japanese GINI coefficient for economic equality is lower than that of the US, in terms of power Japan is a very top heavy, insider dominated society. Their incorporation of University pedigrees into the success ladder would make the Ivy League envious.

Here is a thoughtful discussion of Japanese quantitative easing from just a few weeks ago from Sober Look. As you can see, the consensus was running heavily against an expansion, making the surprise from BOJ the day after the Fed taper even more of a surprise.

"With wage growth remaining sluggish (particularly for non-union workers), rising import costs could undermine consumer demand - particularly in the face of higher consumption taxes. Given these headwinds, there may be sufficient political pressure to put the BoJ into a holding pattern."

I am not sure of all the specifics of what is happening in Japan, but I am becoming increasingly persuaded that the Anglo-American financial cartel and some of its client states are engaging in an intensifying currency war with regard to the international dominance of the dollar.

This extends not only to the dollar as the primary benchmark for international valuations, but also to the more compelling power that such an instrument, in the hands of a single governmentally affiliated entity, provides to those who wield it to set international and domestic policies that go far beyond mere terms of trade.

So I think it is fair to ask for whom the Bank of Japan and their political leadership are making some of their policy decisions. And further, it is incredibly naïve not to ask the same questions about the Federal Reserve and the political leadership of the US.

Money power is political power, in every sense of the word.

Employment In Japan

It has been quite some time since I have been doing business in Japan, and I was curious to know if the culture of the 'salary man' had changed. What is the employment picture in Japan really like for the average person? What are things like behind the statistics put forward in the international press?

While unemployment in Japan is very low at 3.6% or so and the Labor Participation Rate is still fairly high, it looks like 'underemployment' might be something worth looking at given the slack in wage growth. Certainly Japan is experiencing deflation, but is that a 'cause' or an effect as part of some other economic feedback loop?

What happened to the NAIRU non-accelerating inflation rate of unemployment theory? It is the theory put forward by Friedman and the monetarists that refers to a level of unemployment below which inflation must rise due to wage pressures. Personally I think the growth of monopolies, the globalization of markets, and the relative political weakness of labor has knocked another dodgy economic theory into a cocked hat.

Places like the old South might have had nearly full employment, but I don't think slavery was adding seriously to wage pressures. Quite the contrary.

Sometimes it is not always easy to find things because people tend to be very positive about their country, especially when speaking with others. And I dislike looking at OECD statistics and other compendiums because they tend to lose quite a bit with time lag and a lack of insight past government statistics which, and I know this is hard to believe, tend to paint a pretty picture.

But I did get this in from a long time friend in Japan.

"It is difficult for many young people who are part-time or temporary, particularly the men. It is hard for them to "attract" a mate. Many couples are both employed but when they have children there is pressure to find a nursery and often times the wife cannot return to her former job. This obviously complicates the demographic conundrum. Although I do not have figures, this sort of conversation comes up even on the TV.