Obama to Pick Yellen as Leader of Fed, Officials Say


#1

nytimes.com/2013/10/09/business/obama-to-nominate-janet-l-yellen-as-fed-chairwoman.html?_r=0

IMO this is worse than Summers. A continuous easy money policy is the last thing the U.S. needs. The Senate should block this nomination, but she will no doubt get the 60 votes.


#2

[quote="ProVobis, post:1, topic:341517"]
nytimes.com/2013/10/09/business/obama-to-nominate-janet-l-yellen-as-fed-chairwoman.html?_r=0

IMO this is worse than Summers. A continuous easy money policy is the last thing the U.S. needs. The Senate should block this nomination, but she will no doubt get the 60 votes.

[/quote]

Confirmation hearings on a farce. I remember Kagan's confirmation hearing in which Senator Lindsey Graham asked "Where were you at on Christmas Day?" At first people thought it was a joke, but he was dead serious. Her response has since been immortalized on youtube.


#3

Another Fed leader who will keep the printing presses going. Keep creating money. Keep penalizing savers. Keep pumping up the housing and stock markets. No worries. The bubble will never burst. Will it?


#4

The Rothschilds

"The few who understand the system, will either be so interested from it's profits or so dependant on it's favors, that there will be no opposition from that class." — Rothschild Brothers of London, 1863

"Give me control of a nation's money and I care not who makes it's laws" — Mayer Amschel Bauer Rothschild

Senators and Congressmen

 "Most Americans have no real understanding of the operation of the international money lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States" — Sen. Barry Goldwater (Rep. AR) 

"This [Federal Reserve Act] establishes the most gigantic trust on earth. When the President [Wilson} signs this bill, the invisible government of the monetary power will be legalized....the worst legislative crime of the ages is perpetrated by this banking and currency bill." — Charles A. Lindbergh, Sr. , 1913 

"From now on, depressions will be scientifically created." — Congressman Charles A. 

Lindbergh Sr. , 1913

"The financial system has been turned over to the Federal Reserve Board. That Board as ministers the finance system by authority of  a purely profiteering group. The system is Private, conducted for the sole purpose of obtaining the greatest possible profits from the use of other people's money" -- Charles A. Lindbergh Sr., 1923 

"The Federal Reserve bank buys government bonds without one penny..." — Congressman 

Wright Patman, Congressional Record, Sept 30, 1941

"We have, in this country, one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board. This evil institution has impoverished the people of the United States and has practically bankrupted our government. It has done this through the corrupt practices of the moneyed vultures who control it". — Congressman Louis T. McFadden in 1932 (Rep. Pa)

"The Federal Reserve banks are one of the most corrupt institutions the world has ever seen. There is not a man within the sound of my voice who does not know that this nation is run by the International bankers — Congressman Louis T. McFadden (Rep. Pa) 

"Some people think the Federal Reserve Banks are the United States government's institutions. They are not government institutions. They are private credit monopolies which prey upon the people of the United States for the benefit of themselves and their foreign swindlers" — Congressional Record 12595-12603 — Louis T. McFadden, Chairman of the Committee on Banking and Currency (12 years) June 10, 1932 

"I have never seen more Senators express discontent with their jobs....I think the major cause is that, deep down in our hearts, we have been accomplices in doing something terrible and unforgivable to our wonderful country. Deep down in our heart, we know that we have given our children a legacy of bankruptcy. We have defrauded our country to get ourselves elected." — John Danforth (R-Mo)

"These 12 corporations together cover the whole country and monopolize and use for private gain every dollar of the public currency..." — Mr. Crozier of Cincinnati, before Senate Banking and Currency Committee - 1913

"The [Federal Reserve Act] as it stands seems to me to open the way to a vast inflation of the currency... I do not like to think that any law can be passed that will make it possible to submerge the gold standard in a flood of irredeemable paper currency." — Henry Cabot Lodge Sr., 1913

jesus-is-savior.com/Evils%20in%20Government/Federal%20Reserve%20Scam/quotes_on_the_federal_reserve.htm


#5

It's official. She's been nominated and Congress will continue to borrow at low interest. Savers, insurance companies, and pensions will continue to take the hit. Medical costs and premiums will continue to go up, oil prices will rise, etc. and the taxpayers won't know what hit them.

Why is this the only issue the Senate can get 60 votes on? Do they really expect to control spending with this appointment? Doesn't make sense.


#6

[quote="ProVobis, post:5, topic:341517"]

Why is this the only issue the Senate can get 60 votes on? Do they really expect to control spending with this appointment? Doesn't make sense.

[/quote]

What ever gave you the idea that they want to control spending? :shrug:


#7

So the Fed will continue to keep savings rates near zero and pump out money, thereby penalizing savers, pumping up the housing market, and forcing savers into the stock market. Eventually rates will have to rise, bursting some bubbles, and once again giving a hit to savers who took their money out of zero rate CD's and put it into riskier investments.


#8

[quote="JimG, post:7, topic:341517"]
So the Fed will continue to keep savings rates near zero and pump out money, thereby penalizing savers, pumping up the housing market, and forcing savers into the stock market. Eventually rates will have to rise, bursting some bubbles, and once again giving a hit to savers who took their money out of zero rate CD's and put it into riskier investments.

[/quote]

Even those that buy and hold those low rate Treasuries will be taking risks. The price on some of the issues are as high as 150, which is strange when one considers they will only get 100 when the bond comes due. Simple game of chicken with high-rated securities. And there's nothing to say the banks will lend more to the individual consumer when yields go lower. Senator Warren, who backs Yellen, is only kidding herself if she doesn't see another bank crisis coming out of this.


#9

[quote="ProVobis, post:8, topic:341517"]
Even those that buy and hold those low rate Treasuries will be taking risks. The price on some of the issues are as high as 150, which is strange when one considers they will only get 100 when the bond comes due. Simple game of chicken with high-rated securities. And there's nothing to say the banks will lend more to the individual consumer when yields go lower. Senator Warren, who backs Yellen, is only kidding herself if she doesn't see another bank crisis coming out of this.

[/quote]

I wouldn't buy a treasury security for anything, and for the very reason you mention. They lose principal value big time if the prevailing rate goes up even moderately.

The stock market is scary for the very same reason, though if it holds more or less stable while inflation creeps up all around it, the Fed might dodge the bullet that has "stock market" written on it.

Perhaps I should consider myself lucky (?) that I still have debts. When it comes to investing, "investing in my own debt" (paying it down or off) gives the best yield going.

And i'm still not afraid of cattle. Prices are good, and herds are still not being replaced. People will still eat, and people wealthy enough to buy the prime stuff will do it almost no matter what it costs. They'll complain, but they'll still buy it.

But I don't think there is any reason to expect Yellen will not be confirmed or that she will greatly differ from Bernanke.


#10

[quote="ProVobis, post:5, topic:341517"]
It's official. She's been nominated and Congress will continue to borrow at low interest. Savers, insurance companies, and pensions will continue to take the hit. Medical costs and premiums will continue to go up,.

[/quote]

Interesting that you would say this. I have long thought a big part of health insurance premium increases over the last several years is due to the inability of insurers to make anything on their liquid investments. If you're not making anything on your cash reserves, the only place to go is premiums.

A good part of the push for Obamacare was premised on what seems now to be the total myth that it would bring insurance costs down. And yet, one of the major drivers of premiums was artificially low interest rates.


#11

I doubt they've considered the possibility that we've crossed into the realm wherein lowering interest rates will actually *decrease *demand. Savers may now actually compensate for the declining value of their saving by just saving even more and spending even less.

I believe this may be a form of what is called the Giffen paradox, and was first observed in the Irish potato famine: because people felt compelled to purchase potatoes rather than meat, because potatoes were much cheaper than meat, when the price of potatoes went up (but not enough to make potatoes nearly as expensive as meat), people responded by purchasing even more potatoes and less meat.

This may be what is going on with saving right now: lower interest rates make saving 'more expensive,' but those who are committed to saving will only respond by saving even more to compensate for the increased penalty imposed on saving. In which case the Fed's plan would no only be ineffectual, it would backfire.

Recommended reading for the Obama administration: Principles of Economics by Alfred Marshal, who first published the postulation of the aforementioned paradox.

This may well be the idea. Pushing people into the stock market temporarily boosts the market. And for reasons that defy logic, most Americans still look to the stock market as the default indicator of the state of the economy. This gives the public the impression of better economic performance than is actually occurring, thereby improving the popularity of the administration in the short run. All they really have to do is hang in there for a few more years then pass the hot potato onto the next admin.


#12

[quote="Raskolnikov, post:11, topic:341517"]

This may be what is going on with saving right now: lower interest rates make saving 'more expensive,' but those who are committed to saving will only respond by saving even more to compensate for the increased penalty imposed on saving. In which case the Fed's plan would no only be ineffectual, it would backfire.

[/quote]

That makes sense. Low interest rates as well as QE's may also keep reinforcing the notion that we have a poor economy to begin with and no sense thinking about hiring or spending money unless absolutely necessary.

Long diet of artificially low interest rates didn't work in Japan and it won't work here. Jim Cramer et al just don't get it. Not too many in Congress either.


#13

True, but of course no one wants to be the party pooper who dares to raise the rates again and have his name cursed by everyone in the world every time the DOW drops so much as a point.


#14

[quote="Raskolnikov, post:13, topic:341517"]
True, but of course no one wants to be the party pooper who dares to raise the rates again and have his name cursed by everyone in the world every time the DOW drops so much as a point.

[/quote]

Paul Volcker dared and, at first, he was threatened but later was loved as he began dropping rates. Interesting was the appointment of Ayn Rand- and gold-advocate Alan Greenspan, after which the market responded by selling off over 50%, before Greenspan decided he better change his monetary philosophy or else get hanged.


#15

Janet Yellen Belonged to NARAL, Planned Parenthood


#16

[quote="_Abyssinia, post:15, topic:341517"]
Janet Yellen Belonged to NARAL, Planned Parenthood

[/quote]

Interesting and troubling. Doesn't tell us anything about her economic theories except that she doesn't care whether innocent people live or die. And so, when it comes to economic consequences to innocent people???????


#17

Thanks for this. As if what the Fed has been doing all along wasn’t an expression of a great moral hazard enough.

People think that the Fed only prints money for and lends to banks. That is not true anymore.

All Senators who confirm her nomination will have more than stains on their hands.


#18

[quote="Ridgerunner, post:16, topic:341517"]
Interesting and troubling. Doesn't tell us anything about her economic theories except that she doesn't care whether innocent people live or die. And so, when it comes to economic consequences to innocent people???????

[/quote]

I'd answer that but I can't figure out a charitable way to say it.


#19

i do not know anything about this woman yellen, only that she looks like a plain democrat woman. sort of like a janet reno. what experience does she have? to me she is just another puppet in the Obama administration.


#20

Rand Paul Considers Hold on Yellen Fed Nomination


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