Well, yesterday we learned from Federal Reserve Chief Bernanke that he plans to pump another $40 billion dollars a month into the U.S. economy to try and ease that horrendous 8.2 percent unemployment rate and make an effort to boost this stagnant economy. The Wall Street guys call this QE3...the 3 designating the 3rd Fed effort to stimulate the American economy by printing more worthless dollars.
Bernanke feels safe in doing this since the new America has so little knowledge about how economies work. A $16 trillion dollar deficit is just too huge for most Americans to comprehend and those who witnessed Jimmy Carter's 20 percent annual inflation rate and 18 percent home mortgage rates are mostly dying off; younger folks are so enraptured with Obama they wouldn't believe it happened anyway. Even those with a modicum of knowledge of the economy just can't perceive having two thirds of your assets eaten up by inflation and experiencing a severe reduction in their dollar's buying power.
Since our banker, China, has already issued warnings that the U.S. will quit their reckless printing of money or they'll cash in their $1 trillion dollars worth of bonds and send America crashing to the depths of depression, don't expect Bernanke's latest announcement to go over well.
In the past century dozens of Banana Republics have recklessly printed money in a vain effort to save their economy. It always fails. The most recent industrialized country to do so was the Wehrmacht Republic of Germany in the 1930's The Germans did exactly what Bernanke is doing and the Mark became so worthless that folks had to push a wheel barrow full of them to the market to buy a single loaf of bread.
My old Paul Samuelson's Econ 101 textbook tells me that, for every economic action, there is a reaction, and without fail the result of printing money has always been runaway inflation.
What is even more puzzling is the denseness of the liberal mind; we all know American businesses are sitting on $2 trillion dollars in cash and simply won't invest it as long as they have the promise of more taxes and more regulations being dumped on them by Obama and a Democratic Congress. This economy will not rebound until both small and big business have some degree of certainty over taxes and regulation.
Some have speculated that Bernanke's QE3 is spurred by his desire to support Barack Obama. This is a job saving measure as Romney has already stated that, if he's elected, Bernanke will be out of a job.
I don't know if that's true but it surely shows that Bernanke himself is not buying Obama's optimism about this economy. Were the economy doing as well as Obama alleges there would be no need for a third massive printing of soon to be worthless greenbacks.
Sad. Damned Sad.
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