Reply #25: Karl Denninger: Ben "I'm A Liar" Bernanke, Part II

[DemReadingDU]

11/4/10 Ben "I'm A Liar" Bernanke, Part II by Karl Denninger

...now we got another problem. See, The Government doing this for a long period of time leads to what happened in Greece. Bond rates back up and suddenly you can't pay the interest. The nation has happen exactly what happened over there - the interest demanded becomes impossible to cover, and the economy and government collapse.

So now, instead of recognizing what we've been doing (which involves being honest about the above numbers) Ben "I lie like a snake" Bernanke has chosen instead to lie again

So what did Ben Bernanke do?

He inflated the money supply by more than 100%. After saying he wouldn't. And now he's doing it again - this time, he's just announced that he intends to monetize $600 billion - approximately exactly what the Treasury will issue over the next six months.


Without jobs you cannot have any sort of durable economic recovery. Yet there are no jobs being created.

The reason there are no jobs being created is that margins are being trashed. There is no wage pressure available to inflate wages as manufacturing is all offshore in China - a direct consequence of our economic and trade policies. Therefore, the American Worker has no ability to demand higher compensation.


What The Fed is doing, basically, is imposing a huge tax increase of $600 billion over the next six months on the economy.

Tax increase?

Yep.

It's just hidden.

The Government is selling their debt to The Fed. The Fed is in turn debasing the currency. This causes the dollar to go down in value, which in turn causes all commodities denominated in dollars to go up in price.

But wages are not rising (unit labor costs) which means you are forced to absorb the increase in commodity prices without any increase in your earnings.

That's a tax increase.


click link for rest of article and commodity charts...
http://market-ticker.org/cgi-ticker/akcs-www?post=171216