Economic Charts

All economic charts are at the bottom of the page.

Tuesday, December 7, 2010

Ben Bernanke's 60 minutes "We're not printing money"

Here is the 60 minutes interview with the Federal Reserve head Ben Bernanke. He makes the statement "We're not printing money" which I find pretty funny.

If were not printing money can somebody tell me what all these accellerated POMO purchases are (they are printing money).  He says money is not being printed cause money supply is abating, but Money supply is abating due to defaults on mortgages, credit and the paying down of debt as well.  So as he prints billions, billions are coming out of the money supply as well (not this simplistic, but you get the picture).
This looks like money printing to me.  He makes statements that small businesses are not borrowing cause they are in trouble, but what I have heard through several interviews, is that only the stable small businesses are not borrowing as they know debt will crush them.  Small businesses that are in trouble are the ones trying to borrow money and they don't qualify (as well they shouldn't).  Ben says inflation is not happening, that it is actually deflation.  Well I would say it is stagflation, food, energy and clothes (must haves) are going up, it is only housing (big surprise there) and the stuff we don't need to sustain life (i.e. the crap) is what is deflating.

He says that we most likely won't have a double dip, yet Chris Whalen points out that since 2007 we have had approx 4.3 million foreclosures and now have approx 11 million in the pipeline.  It was the housing market and the impact on the credit market due to this (there are other factors as well and they are still in play).

No comments:

Post a Comment