Fake Pricing or Fake Recovery

Jun 23, 2011 by Editor Fred D

Fake Pricing or Fake Recovery

The Obama administration and the Federal Reserve have given the appearance that they will continue with their plan to intervene with the markets and private enterprise to inhibit a recovery.  The Federal Reserve which holds around $2.3 trillion in US debt, plans to continue to purchase debt but with interest off the current debt.

Meanwhile, over at 1600 Pennsylvania Avenue, President Obama plans to let loose some of the crude held in Strategic Petroleum Reserve. The present plan is to dump around 1 million barrels a day for the next month on the market. This will create the assumption that things are returning to some semblance of normalcy.

Shorty after the announcement yesterday, oil dropped about 4.6 to 4.7% a barrel. As off about 11a.m. Eastern Time, West Texas Crude on NYMEX was down to $91.43 and ICE at $91.36 a barrel. This will have a temporary affect on other commodities. However, there is a time when the government will have to replace that crude and will cause the price just not of crude and gas but other commodities to jump.

Bernanke admits that the Federal Reserve or at least himself, does not understand why the recovery is taking so long to kick into higher speed. Obama’s program should have caused the economy to start a sustained recovery.

What Bernanke and Obama have missed is that this plan did not work in the 1930’s, it just made it worse and without a world war there would have been no recovery.  More recently the Japanese proved this type of monitory and physical policy would lead to nothing but a lost decade.

The recession of 1920-1 and that ending World War II were solved by government ceasing rampant spending and getting out of the way of the citizens and business.  Presently the four week average for jobless claims was about 426,250, with the adjusted rate at 429,000.

Business does not seem to have confidence in not the economy but in governments’ actions. Obama seems to want to regulate every action and have the government make all decisions for the citizenry. History has shown this is the worst direction that a people may take. The Weimar Republic, NAZI Germany, USSR, China, Cuba and Zimbabwe should drive that point home. Inflation does not work nor does government control of one’s personal life.

June 22, 2011 Press Conference with Chairman of the FOMC, Ben S. Bernanke

With answers like these he should run for office or become Obama’s Press Secretary.






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2 Comments

  1. Thomas

    Immigration…the Tea Party MUST lead on Immigration reform. They are here. Remove the scum in our prisons, seal the borders and accept those here and tax them and get them off entitlements. The Tea Party MUST be the group of Americans to settle this once and for all. Anything less is political hari kari

    Reply

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