Renowned Swiss economist Marc Faber has called the Keynesian idea of stimulus spending promoted by the Democrat-led government ‘deranged’ and a sure path to hyperinflation.
Unfortunately, Faber said, the next bubble is already here. This time it’s government spending and fiscal deficits that Faber thinks will double the government’s debt during the next six years or less.
“The U.S. government is largely deranged,” he said. “The private sector is the dynamic one, and that’s why I object tremendously against building up fiscal deficits because (they) shift economic activity into unproductive government instead of leaving it in the private sector.”
“The whole economic expansion driven by a bubble in America has been a total disaster and has shifted wealth from the ordinary people who work … to the Wall Street elite,” he said…“The Fed, in my opinion, has zilch idea about monetary policy,” Faber said.
It’s Keynes who now gets the credit for saving us. His idea that massive public spending could single-handedly counter negative growth and rising unemployment was at the root of the stimulus packages governments have rushed to implement this year.
Keynes’s second coming was officially declared a success this week when Nobel laureate Paul Krugman wrote in The New York Times that “Big Government” saved us from a second Great Depression. And just to twist the knife in Republicans, he added: “And aren’t you glad that right now the government is being run by people who don’t hate government?”
What got missed in most reports about the unemployment number announced this month is that 400,000 Americans fell out of the labor force.
The government reported Friday morning that the unemployment rate declined one-tenth of a percentage point to 9.4 percent after the economy shed 247,000 jobs in July. But if that many people lost their jobs, how could the unemployment rate go down instead of up?
The answer is that size of the labor force shrank by over 400,000 people. In June, the Labor Department estimated there were 154.9 million workers in the civilian labor force. In July, that number shrank to 154.5 million.
So while the employment percentage went down, 250,000 more people lost their jobs. In fact, last week initial jobless claims actually rose to 558,000.
36 South Investment Managers Ltd., whose Black Swan Fund gained 234 percent in 2008, is raising money for a new hedge fund, betting that government efforts to pump money into economies could result in hyperinflation.
…“There is a sharply increased risk of greater than 5 percent inflation starting from now,” Haworth said in a telephone interview from London. “We are in the lag period between when the seeds of inflation are sown and when their off- spring, that is higher prices, are evident for all to see.”
The Federal Reserve system of banks and other US intragovernmental holdings account for a stunning $4.806 trillion in US Treasury debt.
Standing at $739.6 billion in January, China’s holdings have skyrocketed from $492.6 billion from a year earlier.
As Republicans such as Boehner and Demint push for financial transparency (with bills H.R. 1207 in the House and S. 604 in the Senate), hypocritical Democrats in the pocket of the Wall Street-controlled Federal Reserve such as Schumer and Dodd are trying to substitute a required audit of the central bank with a bill which would make it voluntary. Here is Schumer’s response denying a citizen’s request to co-sponsor S. 604:
Thank you for writing to me regarding legislation designed to enhance the audit powers of the Comptroller General with regard to the Federal Reserve. I agree with you that transparency and accountability for the Fed is important. Disclosure is something I’ve stood for throughout my career, and I intend to continue to support efforts to expand the kinds of information available to the public.
For this reason, I voted in favor of an amendment which Senator Chris Dodd (D-CT) offered to the budget resolution which was accepted by a vote of 96 to 2 that would ask the Federal Reserve to publish, on its website, reports which give information regarding the nature and amounts of the collateral which it is accepting on behalf of taxpayers within the various lending programs it is conducting and the number of borrowers that are participating in each of the programs, along with specific details of the amount and type of credit extended. I believe that this will help tremendously to make transparent the amount and type of assistance the Federal Reserve is extending.
Again, thank you for contacting me on this important issue. Please do not hesitate to contact me again if I can be of further assistance on this, or any other matter.
Charles E. Schumer
United States Senator
Citizen activists should continue to demand accountability from their elected officials and call out the liberal economic fantasies constructed by the Democrat party.
Share on Facebook 1 1 SHARES Or should I say “Hilariously Ridiculous? You be the judge. I missed this earlier, but lucky for me The Right Scoop didn’t. This is absolutely hilarious. Andrea Mitchell was on MSNBC’s Morning Joe this morning and her reaction to the Cruz “Office Space” campaign ad is … well it’s priceless. I’ll be honest with you, I love his clip. | Read More »
Share on Facebook 1 1 SHARES Donald Trump has a problem with God. Or more specifically, he has a ‘God problem.’ At least when it comes to voters in South Carolina, for whom Christian faith is often a requirement in a public official. This is simply the reality of the state, not a judgment on religion. But Donald Trump is not credible when it comes | Read More »
Share on Facebook 1 1 SHARES One of the most charismatic men of the 2016 campaign, a victim of both circumstance and Donald Trump, Jim Gilmore was never given a chance. But, here is Jim Gilmore being awesome. However, The Hill is reporting that Gilmore is set to exit a stage he was never really on. “My campaign was intended to offer the gubernatorial experience, with | Read More »