-- Posted Friday, 16 November 2007 | Digg This Article
| Source: GoldSeek.com
Perhaps all the bad vibes have something to do with Ben Bernanke, chairman of the Federal Reserve, appearing before the Joint Economic Committee last week and making a fool of himself, and, well, let's have Michael Nystrom, of BullNotBull.com, tell it.
First off, Mr. Nystrom notes that Rep. Ron Paul (R-Texas) was on the committee, and I think that he was, in effect, questioning the competence of Ben Bernanke to head the Federal Reserve, although nobody but the Irritating, Loudmouth Mogambo (ILM) dared remind everyone that Bernanke was hand-picked by the President, and damned near all the other people picked by Bush to do anything for the last seven years was either a laughable incompetent, a bloodthirsty fascist, a toadying sycophant or something else so corruptibly yucky, icky and terrifying that one shudders to contemplate the kind of people it took to develop the satanic Bush administration, which really angers me because these evil people are Republicans, and I am a Republican, and nowadays I am ashamed and embarrassed to be a Republican.
That is why I am voting for Ron Paul, a Republican, for President; he is the only candidate honorable enough, honest enough, smart enough, educated in economics enough and conversant enough with the Constitution to deserve the position, and who will hopefully restore honor, dignity and plain ol' smarts to the Republican Party and the office of the President of the United States, and I expect all real, trustworthy, Constitution-loving Americans else to vote for him, too, and if they don't, then I shall loath and detest them more than I loath and detest them now, which is considerable, to the point of seething hatred in some cases.
I took it from the look on his face that Mr. Nystrom is, like everyone else, predictably horrified at my rude hostility, and disappointed that I am again off the subject, which is about Bernanke testifying before Congress. He then quotes Hopefully-Soon-To-Be-President Paul saying, "they don't say inflate the currency, they don't say debase the currency, they don't say devalue the currency, they don't say cheat the people who save. They say, 'lower interest rates.' But I don't hear you say too often, 'The only way I can lower interest rates is to create more money.' So my question boils down to this: 'How can we expect to solve the problems of inflation…with more inflation?'"
Only the people in the first few rows of the audience behind Mr. Bernanke were close enough to be witnesses, but they say that they could actually hear Mr. Bernanke's sphincter snap shut in panic! Wow! What a response!
Actually, I know how he feels, as many, many, MANY times I was sitting in my boss's office like that, having that selfsame finger of incompetence, corruption and/or stupidity pointing right at me. The only difference between Mr. Bernanke's sphincter problem and my own experience is that I know I will be fired, and so I go into the damned situation already so tense that there ain't nothing anywhere that is NOT tightened into a constricted, painful little knot, including sphincters!
Apparently, everyone was needlessly distracted by my personal little "work experience" interruption, and so Ron Paul persisted, as quoted by Mr. Nystrom, by saying, "How can you pursue this policy that you have without further weakening the dollar? There's a dollar crisis out there, and people's money is being stolen! People who have saved, they're being robbed!"
Immediately, I jump up from the couch and shout at the television, "Yeah! Robbed! These stinking Federal Reserve crooks are helping the federal government steal us blind with their damned inflation!"
Suddenly, here comes Charles Zentay of ThinkInvest.Blogspot.com, who helpfully suggests some questions to ask Ben Bernanke to expose his duplicity, instead of me trying to do the same thing by fruitlessly shouting and screaming at a stupid television set, which, now that I think about it, is probably a good idea.
So I ask him to give us an example of a question to ask that will, as he implies, be as powerful as a sudden burst of machinegun fire from a deranged lunatic smashing a television set into a million tiny pieces of plastic and wiring in a deafening hail of firepower. Without even a moment's reflection he suggests asking, "are you familiar with the Austrian School of Economics, and if so, how would you characterize their explanation for the cause of the Great Depression?"
Mr. Zentay, for the benefit of all the viewers at home, says, "The correct answer, according to Wikipedia, is 'the key cause of the Depression was the expansion of the money supply in the 1920s that led to an unsustainable credit-driven boom.'"
But Bernanke tries to pull a fast one by changing the subject, which he does by declaring, ludicrously, that "If somebody has their wealth in dollars, and they're going to buy consumer goods in dollars, as a typical American, then the only effect it has on their buying power is that it makes imported goods more expensive." Hahahaha!
Of course it does; that is what we just freaking said, you moron! It makes things more expensive! And now he is saying that higher prices, which is bad enough as it is, is the ONLY effect? Hahahaha! Apparently I was right! He is a moron!
Naturally, this has me primed for one of my loud and long Mogambo tirades (LALMT) about how the falling dollar makes domestic goods cheaper in the international marketplace, just as Bernanke says, but that domestic producers will (out of greed and tariffs), raise their prices to match the world prices, which are higher, thanks to the cheaper dollar.
So the end result is that imported goods cost more and domestically-produced goods cost more. Everything costs more! Hahaha! Fabulous work, Federal Reserve morons! Hahaha! Thanks for nothing!
This is where Bernanke proves that he does not understand the first thing about economics in the real world, but only about the simplistic economic theories that exist in the rarified atmosphere of Princeton University, where as head of the economics department he could strut around the place and say silly, stupid crap like this all day long, either because nobody had the guts to tell him he was wrong, or nobody had the smarts to figure out that he was wrong, and that is why, when we are mislead by our intelligentsia, or both, and either way we are freaking doomed, and that is probably also why the Russians, in their bloody revolution in 1917, famously "executed all the intellectuals."
And speaking of the Russian Revolution, according to the Wikipedia, peasants (like you and me, but without dressing in actual rags or digging potatoes with our bare hands) made "inadequate wages", which were "made worse after 1914 by steep war-time increases in the cost of living."
In short, prices in pre-Russian Revolution were rising faster than wages, just like now. The idea is enough to give one pause! A long one! Time enough, anyway, to think of the French Revolution, which had the same underlying cause, which should also give one pause. And the shivers.
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Editor's Note: Richard Daughty is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the editor of The Mogambo Guru economic newsletter - an avocational exercise to heap disrespect on those who desperately deserve it.
The Mogambo Guru is quoted frequently in Barron's, The Daily Reckoning and other fine publications.
-- Posted Friday, 16 November 2007 | Digg This Article | Source: GoldSeek.com
