海角大神

鈥淕lobal Backlash Grows,鈥� says The Wall Street Journal.

This is the backlash against Ben Bernanke鈥檚 crackpot money-printing scheme.

The foreigners don鈥檛 like it. Because the US is flooding the world with 鈥渉ot money.鈥� This fast cash chases oil, commodities, collectibles, farmland 鈥� just about everything.

It creates bubbles. It distorts markets. And it will certainly lead to busts and bankruptcies鈥�and maybe to hyperinflation, too.

So, sit back and enjoy the show, dear reader. It鈥檚 the greatest show on earth. Yes, it will most likely lead to embarrassment and poverty in the US. Yes, the US dollar will cease being the world鈥檚 reserve currency. And yes, America鈥檚 leading economists 鈥� many of whom have won Nobel prizes 鈥� will be shown to be hapless goofballs.

But this is all good news to us. Under the leadership of modern US economists, Americans have been getting poorer for the last 10 years.

Why? How could that be?

With the encouragement of the Fed and Congress, Americans consumed more than they produced. 鈥淕o out and buy an SUV,鈥� said a Federal Reserve governor. 鈥淏uy a new house,鈥� said Fannie Mae. 鈥淪pend, spend, spend,鈥� said mainstream economists.

Result: Americans have less real, net wealth than they had when this millennium began.

Now, finally, the average yahoo is wising up. He鈥檚 lost this job. And he knows he鈥檚 been played for a fool. But he鈥檚 learning. He鈥檚 defaulting on his mortgage鈥�and he鈥檚 paying down his debt.

Consumer credit keeps contracting鈥�it went down by $2.1 billion in September.

But the feds have kept at it. They tempted him with lower interest rates: the Fed brought its key rate down to zero; it can鈥檛 go lower.

The Fed also bought up worthless mortgage loans so he could borrow more cheaply and took over Fannie and Freddie so they could continue suckering people into a lifetime of mortgage payments. The latest word is that losses from Fannie and Freddie could reach to $363 billion through 2013, according to the Federal Housing Finance Agency.

But with Tea Partiers in the House鈥�and the Fed hard up against the 鈥渮ero bound,鈥� what else could they do?

The Fed could print money! No need to ask Congress to pass spending legislation now. Forget what it says in the Constitution. The Fed can print money. And it can use the money how it sees fit 鈥� even funding an 鈥渙ff the records鈥� stimulus program if it wants to.

Each dollar is, in effect, a liability of the US government鈥�engaging the full faith and credit of the government and its taxpayers. But what law was voted on? What act of Congress authorized spending billions of dollars?

How came it to be that the taxpayers are on the hook for $600 billion more in financial responsibilities with no vote of their elected representatives? No point in even asking the question鈥�.

This is, after all, late, degenerate state-guided capitalism. If Congress can make citizens buy something they don鈥檛 want 鈥� such as health insurance 鈥� surely the Fed, which is a privately-owned bank, can write checks from the taxpayers鈥� checkbooks. Heck, nothing is too absurd.

So, the Fed goes boldly where no sensible person would want to go. It is trying 鈥� trying! 鈥� to create bubbles鈥�asset bubbles, to make people feel like they have more money. If people feel richer, the feds reason, they鈥檒l spend more money. Presto, we鈥檒l be richer.

Are we beginning to rant and rave? Are we 鈥渓osing it鈥�? Is there a doctor in the house?

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