February 28, 2008

Helicopter Ben Bernanke say the US is nowhere near stagflation. So, what do you think?


Feels like a period of consumables and services inflation combined with asset deflation.

Bonds scream recession and deflation. Gold screams inflation. And the data read recession.

But hey, what do I know. Ben Bernanke, like Alan Greenspan before him, are gods and intellectual giants that should not be doubted, who do whatever is best for the American people regardless of the impact on bankers, incumbent politicians and Wall Street.

WASHINGTON - Federal Reserve Chairman Ben Bernanke told Congress Thursday that the nation is "not anywhere near" the dangerous stagflation situation that prevailed in the 1970s.

With the economy slowing and inflation rising, fears have grown that the country could be headed for the dreaded twin evils of stagnant growth and rising prices known as "stagflation."

"I don't anticipate stagflation," Bernanke told the Senate Banking Committee.

63 comments:

Vectorz said...

Is this similar to how he predicted subprime was 'contained'? And how he predicted 'no recession'? Or how about when he predicted 'no slowdown in economy'?

Bernanke is an idiot, working to serve his own kind. He might as well join the NAR

Andrew Hac said...

The Americano nation and its pitiful occupants's fate has entered a dark age, an ominous age filled with peril and uncertainty. An age of unimaginable stench emanating from the fart of the Housing Bubble. Who do you have to blame but yourself when you bough a $700K house on a $40K annual salary as a low-life telemarketer, a StarBuck cashier, a convenient store sale associate ? Add in a fat-ass, lazy, couch potatoes, hoity-toity wify, a couple of red neck kids and you now have a perfect storm for the crashing of not only the Americano economy but the Americano family value as well.

Thus, with all due respect, I will ask you a few live and death questions:

IS THE AMERICANO roasted yet like a grilled snapper turtle ?

WILL THE AMERICANO ever find a shred of WMD in Iraq, the little nation that the Americano president DUBYA SHRUB had decided to invadea few years ago ?

WHAT IS INSIDE the tummy of most Americano ? Greed and Sh*ts mostly, perhaps ?

WHEN WILL THE AMERICANO "Gone With The Wind" ?

Anonymous said...

Fed Chairman Bernanke said...

some small U.S. banks might go under during the current housing market problems, but the U.S. bank system overall remained solid.

Isn't that what he said about the housing market last year?????

Anonymous said...

Ya, and in other news, the sun moves around the earth.....

Anonymous said...

Get this from AP:

NEW YORK - For the first time in history, more than one in every 100 American adults is in jail or prison, according to a new report tracking the surge in inmate population and urging states to rein in corrections costs with alternative sentencing programs.

The report, released Thursday by the Pew Center on the States, said the 50 states spent more than $49 billion on corrections last year, up from less than $11 billion 20 years earlier. The rate of increase for prison costs was six times greater than for higher education spending, the report said.

AND Bernanke said: "we are nowhere near stagflation!"
Just imagine if we were in that neighborhood!!!!
MAX

edd said...

Bernanke just said at the hearing:
"I don't think foreign
investors have lost any
faith in the U.S. markets."

Break out the boots !!
Or the waders !!
Hold the Koolaid !

bobby jones said...

during the depression "only 30% were unemployed." while that sucks, that does imply 70% still had jobs. and a recession is not as severe.

so, I'd say it all depends what boat your in! some boats are floating while others have leaks.

Michigan and Detroit have been brushing with poverty for some time now and, for those folks, they surely see recession and perhaps little hope.

Alfred E. Neuman said...

And the stock market is screaming "What, me worry?"

Anonymous said...

If you read the Time magazine Year in Review article from 1970, the government thought they had inflation under control then. Ahhh, the best laid plans of mice and men.

Anonymous said...

Step away from the crack pipe

Anonymous said...

All I know is my friend in DC just got a job with an insurance company that insures homes. Appearently they are paying him $100 an hour (max two hours) to conduct an investigation on the house, ask neighbors if anyone lived there, etc. The whole point of the investigation is so that the insurance company, if it is found that one small thing was a lie, can tell the mortgage company to fuck off and that they will not be covering the gap between short sales or foreclosures.

Malcolm said...

If I were smart, I would get a schedule of his future appearances before congress, and short the s**t out of the market just before he speaks.

Everytime he opens his mouth, the market tanks.

personally, I think that this is because everyone knows he's either lying or misinformed; and that the market will only go up if he starts admitting the truth that the rest of us have know for a while.

Lady Di said...

Bernanke is deflating. Think about it. Why would he inflate? It would cost the US more to pay the interest on our trillions of debt and fund the entitlement programs for all those baby boomers.

By deflating, he saves the US some serious coin.

This is not stagflation. It is deflationary recession with a little added bonus of high prices in food and energy due to the rising demand from the emerging countries.

What do you do in these times? Short stocks, save cash for future fire sales, get out of debt.

And buy gold - the only currency that stands the test of time. (my personal favorite move.)

PANDG said...

It's interesting that no one here believes BB's comments. I tend to think he's lying because he believes if he told the truth, the fantasy would collapse. But, I could be wrong. He might just be stupid enough to believe that, despite his track record of uniformly wrong predictions, this time, he's going to get it right. One of the interesting things about stupid people is that they don't KNOW they're stupid. That's WHY they're stupid and that's why there is no hope for them ever getting smart.
Again, isn't it telling that no one here believes the head of the Fed?
These are scary times and it's hard for me to see a good outcome for America.

Anonymous said...

Two Questions, hopefully someone can answer:

What does Mark to market mean?

What is the significance of the Snapper turtle?

Anonymous said...

Andrew Hac hates America and wants the terrorists to win!

Anonymous said...

Hey, *we* didn't mention stagflation, Ben. What's on your mind?

1970s stagflation was partly driven by printing money to pay for the Vietnam war (rather than raising taxes). This also broke Bretton Woods, brought the US off of the gold standard, etc.

2000s/2010s stagflation will partly be driven by printing money to pay for the Iraq/Afganistan wars, refusing to raise taxes, etc.

Vietnam cost about $600 bn, inflation adjusted. Iraq/Afghanistan is currently costing at least $3 tn - 5 times as much. (E.g. article in the UK Guardian). Interest payments on this alone will be $1 tn by 2017.

It's the war, not the credit crisis as such, that will drive this. I'm surprised that this is not talked about more. I don't take any pleasure in it, we're middle-middle class and expecting our first child, and I'm pretty scared about this.

I'm sure the Fed know this, and they are sh*tting themselves.

Ed said...

It's the little things that I notice which stand out. Example I was at Sweet Tomato for lunch the other day. I hadn't been for a while. I was shocked when I saw it was $7.79 for lunch. I remember just a few years ago it was $6.19 for lunch, that's a freaking 25% increase. And jokers like Bernanke say inflation is 2% a year. Sure thing Benny, sure thing.

Anonymous said...

Ya know, I'm beginning to think that andrew hac and blowfly are the same person. Their posts are only different in the way that MTV and CH1 are different.

Anonymous said...

Yes, but does he think we are already in stagflation? If we're in it then of course he would not need to "anticipate it"

europe smells said...

Hmmm.
I think the US is going thru an economical rough patch.
But Europe is toast.
Europe has been on a steady inflationary climb since the creation of the Euro/ EU.
Aside from a few foreign gezilionares most Europeans are poor.

But but Europeans are savers and don’t borrow / leverage like Americans.
Not true!
Savings rate has been steadily going down as cost of living has been going up.
They aren’t small spenders by choice, they simply canot afford to.

Our problems are small potatoes to what’s coming down the pipe across the pond

I’m stocking up on popcorn.
Before word gets out that HPers are buying it all up.

Keefer: was thinking, with the temporary irrational spike in the Euro,
How much does a * medium size popcorn go for these days in your neck of the woods?
I heard it was something like $49– $59 – without butter and $89-$109 with.
is that true?

I was under the impression that Europeans don’t really snack much due to the carbon footprint issue, as well as concerns of appearing ‘American like’.

Also, rumor has it that the EU ‘central people-fat monitoring regulatory commission’ is filing a petition with the EU ‘central people walking-speed control’ regulatory court, to place cameras and tracking devices in all ‘non genetically modified’ corn kernels, for the over all higher good of the member states.

* Only applies to EU member states that have a grace period to the ‘nothing lager that a size small’ regulation.

super proud americano said...

Andrew Hac,
Is that you Mohamed?

Next time try a glass of wine with that bomb-roasted camel shish kebab.
You’ll be amazed at the effect.
Imagine what it would feel like to loosen that rope holding that diaper on your head, oh that feeling, blood to the brain.

Anonymous said...

"For the first time in history, more than one in every 100 American adults is in jail or prison"

http://www.bop.gov/news/quick.jsp#2

Interesting:

Inmates By Race
White: 112,550 (56.4 %)
Black: 80,275 (40.2 %)
Native American: 3,484 (1.7 %)
Asian: 3,379 (1.7 %)

But note, Ethnicity
Hispanic: 62,261 (31.2 %)

So, of the 56.4% that are "white," 31.2% of those are "hispanic," meaning that blacks and hispanics make up 71.4% of the federal prison population, of which 16.9% are illegal Mexicans?

Just great.

Mark said...

Anyone who eats or drives a car knows perfectly well how much our costs have increased during Bushco's Ciderella economy while wages stayed flat or declined. Bernanke said today that he is not worried about food or energy costs as much as propping up the banks and markets. So basically if you work for a living and have a family you're f*cked. Too bad you can't eat plasma TVs, DVD players or toys from China as these are the only thing that cost less than they did 7 years ago.

Anonymous said...

He also didn't think that housing was in a bubble and that the subprime problems would be "marginal".

:-)

Anonymous said...

Anonymous said...

Get this from AP:

NEW YORK - For the first time in history, more than one in every 100 American adults is in jail or prison, according to a new report tracking the surge in inmate population and urging states to rein in corrections costs with alternative sentencing programs.

The report, released Thursday by the Pew Center on the States, said the 50 states spent more than $49 billion on corrections last year, up from less than $11 billion 20 years earlier. The rate of increase for prison costs was six times greater than for higher education spending, the report said.

I believe that we should offer the 1 in 100 inmates a foreclosure. This would give them a place to call home and a reason to rehabilitate. They would need to clean the green swimming pools of sludge and disease, cut the grass, do homeowner repairs in exchange for a shot at living the American Dream complete with granite countertops and authentic distressed hickory floors.

Since it costs 6 times more to keep them in prison than to provide them with a college education, lets just knock out both of these tax payer expenses at once and relocate the incarcerated straight to the McMansions.

Bank is happy with live in landscape and pool maintenance and the neighbors should be thrilled with the cut grass and on site mosquito abatement (provided they can get past the green prison tatoos) when these guys are working in the yard shirtless.

God Bless America. A shining beacon on the hill of freedom.

gadfly said...

I now know why Ben Bernanke has a furry beard. It is to cover up the fact that he is a bare faced liar!

Anonymous said...

"The problem is that they are fighting the wrong disease,” J. Michael Martin, a lawyer, and the chief investment officer of Financial Advantage, Columbia, Md., tells MoneyNews.com.

"High interest rates were not the problem, so low interest rates are not the cure. Under-spending by citizens was not the problem. Overspending was. Don’t borrow more money to prime the pump!” he warns.

GT said...

"Ahhh, the best laid plans of mice and men."
lenny, can i tend the rabbits?

dude's my idol...cant quite get the grey he has but he inspired my beard

Anonymous said...

Crisis cushioned
By Daniel Dombey

Published: February 19 2008 02:00 | Last updated: February 19 2008 02:00

George W. Bush yesterday suggested that the war in Iraq could help the US economy, arguing that war spending had contributed to demand and cushioned the blow of the subprime mortgage crisis, writes Daniel Dombey in Washington .

The president rejected the idea that the war was an economic burden. "I think actually the spending in the war might help with jobs . . because we're buying equipment, and people are working."

Copyright The Financial Times Limited 2008

Anonymous said...

Paulson dismissed the various new plans being touted by elected officials now anxious to be seen doing something -- anything -- to forestall the inevitable: Large numbers of people being kicked out of homes they can no longer afford and, mostly probably, never should have bought in the first place.

"I'm seeing a series of ideas suggested involving major government intervention in the housing market, and these things are usually presented or sold as a way of helping homeowners stay in their homes," Mr. Paulson said.

"Then when you look at them more carefully what they really amount to is a bailout for financial institutions or Wall Street."

Anonymous said...

We're not near stagflation. We're in stagflation.

borkafatty said...

Andrew Hac........Typical prom night dumpster baby trash.

Anonymous said...

For the lying leftwing freaks and kooks

http://tinyurl.com/2xy35s

AP
Paulson Rejects Government Bailouts
Thursday February 28, 1:23 pm ET
By Martin Crutsinger, AP Economics Writer
Paulson Says Various Housing Proposals Would Do More Harm Than Good


WASHINGTON (AP) -- Treasury Secretary Henry Paulson said Thursday that various proposals being put forward to deal with the housing slump would do more harm than good.
While he said that while the housing problem remains the biggest downside risk to the economy, the issue needed to be put in perspective. Paulson said that 93 percent of all mortgages are being paid on time and that less than 2 percent are in foreclosure.

"So while some in Washington are proposing big interventions, most of the proposals I've seen would do more harm than good," the secretary said in remarks prepared for delivery Thursday night before the Economic Club of Chicago.

"I'm not interested in bailing out investors, lenders and speculators," he said. "I'm focused on solutions targeted at struggling homeowners who want to keep their homes."

Paulson's comments represented the strongest administration objection lodged so far to a variety of proposals being pushed by Democrats in Congress to do more to help. Paulson said that dealing with the mortgage problems needs to be a shared responsibility.

"If borrowers aren't willing to ask for help or respond to efforts to reach them," he said, "there is only so much that others can or should do on their behalf."

Anonymous said...

Did they actually swear him in before his testimony?

Anonymous said...

If it walks like a duck and talks like a duck it sure the fuck isn't a penguin.

Anonymous said...

Hilarious blog on the Obama freaks

www.obamamessiah.blogspot.com

Out at the peak said...

Stagflation is already here. "High yield" savings accounts down to 3.5% yet 17% increase in gasoline cost over the last 3 months. Real estate prices down in my area 20% from Nov 2005 (34% for my old house), but bread cost up 30%. These numbers may differ for others, but this is what I'm seeing.

And the craziness isn't half way over.

g-man said...

Of course he doesn't fear stagflation. He knows damn well we are headed for a hyperinflationary blowoff followed by a depression.

Anonymous said...

Keith,
Do you not understand that undollar assets are going to scream higher. You can have deflation in certain assets while at the same time hyper inflation in commodities like food, etc. All you HPrs who have been calling for a top in gold are being steamrolled. Monetary inflation always leads to "price" inflation.

Anonymous said...

Dont worry, be happy, your friend Barak Hussein will fix everything.

Anonymous said...

Ben is half right. He should have limited his statement to:
"I do not anticipate..." -period, stop.

lol I just don't anticipate.

tater said...

SO, Bernanke doesn't think we're anywhere near stagflation. Read what he said:

"We are facing a situation where we have simultaneously a slowdown in the economy, stress in financial markets, and inflation pressures coming from these commodity prices abroad," Bernanke said.

That, fellow HP'ers IS stagflation.

Anonymous said...

Who gives a crap what Bernanke says or any other one of these establishment pricks says? It's all lies and subterfuge. Everything you hear on TV, radio and everything you read in newspapers is total propaganda and diversionary noise. It's all BS.

Screw them all. Pick up your pitchforks and march on Washington. These lying, stealing scum suckers have got to go!!!

Anonymous said...

oh gosh oh gee gas is $3 and milk is $4. only people who give a fuck are the wothless pieces of shit that make $10 an hour. all you supposed financial geniuses here are nothing but mcworkers without a pot to piss in.

straw buyer said...

This is what happens when you let maggots who were raised by nannies run the country. Paulson, Bernanke, Bush, their mother didn't love them, so they got no tittie milk. No they are taking it out on everyone else.

Anonymous said...

Bernanke also said months ago that the subprime meltdown was self-contained.

And the corrupt MSM (Glen Beck, O'Reilly, Hannity, Anderson Cooper, Tim Russert, Chris Matthews, Wolf) all give Bernanke and this administration a free pass. What's important is how many times Bill Clinton said the word "I" in a speech or how Hillary laughs.

America, the biggest POS nation in the world! Fly that Made in China American flag high, while the GOP picks your pockets. Oops, $8 billion dollars just disappeared in Iraq but look over here how Hillary laughs. Do you hear it? Chris Matthews, Tim Russert, Anderson Cooper, Hannity, O'Reilly, and the retard Glen Beck is telling you to look over here, so you obey sheep.

Anonymous said...

Hey Ron Paul followers, don't you feel a bit pissed that the GOP and the MSM just screwed you good without Vaseline, while pushing Obama and McCain down your throats? You must be feeling real good about it, huh? Now be a good sheep and play their game, go ahead and vote for the candidate that Keith and the corrupt MSM picked for you or don't vote at all, which also benefits them.

Anonymous said...

It seems what he says is always just wishful thinking. He says what he "hopes" will happen, not what is likely. I see no way any self respecting economist can say we will not have "stagflation", growth is slowing, inflation is rising, the very definition of stagflation. Based on what evidence does Bernanke say this will not happen? News for you Ben, it is happening, right now.

Anonymous said...

NEW YORK - For the first time in history, more than one in every 100 American adults is in jail or prison

And yet, the government can't make use of those low lives to build the second Great Wall of China on the border with Mexico. Please keep in mind that the original Great Wall in China was built in the 5th Century and stretched for over 4,000 miles of hills. The US needs to build just 2,000 miles on a flat extension. Surprise, surprise, after transferring billions from taxpayer money into the pockets of the GOP cronies, now they're saying that the "Technological Fence" (nice Republican word) is not working and it was a failure. The Republican cronies are not refunding the cost to taxpayers either.

Hey but we know that the fence thing was just another ploy to fool the American sheeple; after all, some of us with a working brain know that the Corporate Fascists need more Mexican mouths to eat their hamburgers and corn, to drink their cancerous soft drinks, to eat their corn syrup and get obese to spend more money with big pharma, to buy their American crappy cars, to fund corrupt churches, to buy homes they can't afford, to fuel the housing ponzi scheme through cheap Mexican construction workers, more people to be banker's financial slaves, more poverty to make Republicans feel superior with an under cast below them which allows to point fingers and be false moralists, a tsunami of cheap and illegal labor to depress wages so the fascists can keep the profits and not pass the savings to consumers, to continue the New World Order plan of dumbing down America, to consume more oil, to buy more crap from China which benefits Neil Bush's lobby company that defends Chinese interests in Washington, etc, etc, etc.

That's why Bushco and his evil GOP love an open border and didn't do anything in the last 7 years to close it. Sorry evil Republican bootlickers working out of a desk in Washington, who sell their mothers and their children for a buck. No excuses allowed here. We had 7 years of Republican administration, Republican majority in Senate, and Republican majority in the House. The Republican majority could have fixed this problem if they wanted too. Plenty of time and resources were available. Accountability anyone?

You voted for it TWICE, so enjoy the mess you helped to create. The rest of the world hates Americans because of you. I say let's all vote for McCain and burn this mofo country down for good.

Anonymous said...

If we are not in a recession, then why does the U.S. Mint continue to halt production of gold coins ? Only for the simple reason that gold is rising/dollar is falling faster than they can set a market price in time for production without losing money.... -Gold Bug

UncleNutJob said...

great article... thanx for your efforts! Always love finding others with a few brain cells.
i have bookmarked you and will be checking back frequently.

if you'd like, check out my article on inflation at http://fractionalreservebanking.blogspot.com

cheers!

Anonymous said...

Ben looks a little stressed in that photo. Anybody want to venture a guess as to what he was rubbing his forehead about this time? That guy better take care of himself, because if his head is hurting now, imagine wh...

Anonymous said...

Mark to market =

To adjust value to market reality.

Evaluate worth, and reprice.

Anonymous said...

Looks like the 1970's to me all over again, high gas/oil, big cars, big houses, high gold, food sky high, so it's time to put another Jimmy Carter in office so we can get to interest rates greater than 15% by 2012.

WINGS said...

Cause' it's a bittersweet symphony, this life.

Try to make ends meet, you're a slave to money then you die.

I'll take you down the only road I've ever been down.

You know the one that takes you to the place where all faiths meet, yeah...

I can't change my mode...I can't change...

--Bittersweet Symphony, The Verve

http://www.youtube.com/watch?v=rWfkiNmbspo&feature=related

Anonymous said...

Deflation buddies.

Consumers are unwilling to spend and banks are unwilling to lend.

Danny

SeattleMoose said...

Firing squad...and I volunteer!!!

Anonymous said...

Bernanke's misssing hair piece said.

Yeah, and I don't have a receding hair line!! I really don't, its called creative backing.

Anonymous said...

I think we are in StagDEflation.

Anonymous said...

Anonymous bobby jones said...

during the depression "only 30% were unemployed." while that sucks, that does imply 70% still had jobs. and a recession is not as severe.
so, I'd say it all depends what boat your in! some boats are floating while others have leaks.

Michigan and Detroit have been brushing with poverty for some time now and, for those folks, they surely see recession and perhaps little hope.

February 28, 2008 5:27 PM
==================================
I don't want to panic you bobby, but I did read recently that something like 33% of the people under 65 are no longer in the work force.

Anonymous said...

Anonymous said...

Crisis cushioned
By Daniel Dombey

Published: February 19 2008 02:00 | Last updated: February 19 2008 02:00

George W. Bush yesterday suggested that the war in Iraq could help the US economy, arguing that war spending had contributed to demand and cushioned the blow of the subprime mortgage crisis, writes Daniel Dombey in Washington .

The president rejected the idea that the war was an economic burden. "I think actually the spending in the war might help with jobs . . because we're buying equipment, and people are working."

------------------------------
Well, the war isn't a burden for him or his rich buddies. The whole Libertarian/conservative economic package is:

1. Cut taxes for the Rich.
2. Borrow & Spend.
3. Increase military spending and make war.

Anonymous said...

Anonymous said...

Looks like the 1970's to me all over again, high gas/oil, big cars, big houses, high gold, food sky high, so it's time to put another Jimmy Carter in office so we can get to interest rates greater than 15% by 2012.

History lesson?

Paul Volker was the Fed Head during Carter and also Reagan. He raised interest rates to 21% and slammed on the brakes before the 70's bubble and inflation finally stopped. That is what it took to bring sanity back to the economy. Carter did not do anything. He didn't know what to do, except get on TV in his sweater and tell us we needed to quit spending.

That pissed of Merikans. How dare he tell us not to buy a new car now. Will cost more tomorrow. Bush just tells us don't worry be happy no problem. Merikans seem to do a lot better with that.

It was Paul Volker who took the bull by the horns and wrestled it to the ground. Volker is the most respected Fed Head ever. He still commands respect wherever he goes. He has guts, fortitude and morals. He makes this simpering, whining Bernanke puke look like Gollum and his magic "precious" ring.

Bernanke should be fired today, and Volker returned to raise interest rates to THE MOON and put a stop to this bullshit.

PS Volker stated a few weeks ago that the Fed had lost control.

Ya think?