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Wednesday, July 13, 2011

The Bernank Testimony

Not much positive in the news today.  TSA continues to enrage people by groping them in the security lines.  Several Euro nations receive downgrades on their debt.  BIG SURPRISE!  And Congress isn't close on making a deal on the debt ceiling.  One positive, gold and silver positions are up, as well as the overall market.

I have been saying this for a while now.  The move in gold and silver have also been an indicator.  Bernanke doesn't know how to do anything but inflate until our dollar will be worthless.  I don't think it's his problem anymore.  Our government just needs to quick spending, period.

"Prepared To Respond If Stimulus Needed" 

Among the critical items to be discussed are the role of fiscal policy, whether there will be QE3, and how (and when) the Fed will proceed with future rate hikes. Mostly, it is expected be a whole lot of hot air. Full text of the report can be read here. The reason everything is surging is because, as predicted, the Chairsatan appears to have just ushered in QE3: "The possibility remains that the recent economic weakness may prove more persistent than expected and that deflationary risks might reemerge, implying a need for additional policy support. The Federal Reserve remains prepared to respond should economic developments indicate that an adjustment of monetary policy would be appropriate."

Key speech highlights:
  • Fed's Bernanke says economy could evolve in a way that would warrant move to less accommodative policy
  • Fed's Bernanke says given uncertainties about recovery and inflation, Fed remains prepared to adjust stance of policy if appropriate
  • Fed's Bernanke says possibility remains that weakness more persistent than expected, deflation risks may return implying need.
  • Fed's Bernanke says most recent data attest to continuing weakness of labour market, unemployment rate to decline only gradually
  • Fed's Bernanke says recent weaker-than-expected economic performance appears to be the result of temporary factors
  • Fed says debt ceiling debate hasn't affected Treasury prices yet
  • Fed's Bernanke says inflation has picked up so far this year, but more of recent rise appears likely to be transitory

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 I'm starting to really like Ron Paul.  The way The Bernank gets flustered is classic.  I'm not comforted by the fact that we hold gold as reserves because of "Tradition".  What does that even mean? 

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