Ron Paul You Created This Crisis
Posted on August 2, 2009
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Thank God Ron Paul is willing the tell the truth.
Here is was the Federal Reserve is telling Ron Paul and Congress:
Federal Reserve Chairman Ben Bernanke sought to ure Wall Street and Congress Tuesday that the Fed will be able to reel in its extraordinary economic stimulus and prevent a flare up of inflation when the recovery is more firmly rooted.
Bernanke, in prepared testimony before the House Financial Services Committee, also said any such steps will be far off in the future and that the central bank’s focus remains “fostering economic recovery.”
To that end, he again pledged to keep its key bank lending rate at a record low near zero for an “extended period.” Economists predict rates will stay at record lows through the rest of this year.
Bernanke is expected to face tough questions from lawmakers about taxpayer bailouts of financial companies, slow-moving government efforts to curb home foreclosures and efforts by the Obama administration to expand its regulatory duties.
“The Fed has made some big mistakes,” said the panel’s highest-ranking Republican, Spencer Bachus of Alabama. Letting the Fed become the financial supercop would be “just inviting a false sense of security” that would be shattered at taxpayers’ expense, he warned.
Laying out a plan now to unwind the Fed’s stimulus may give Bernanke more leeway to hold rates at record lows to brace the economy. That’s because doing so could tamp down investors’ fears that the Fed’s aggressive actions to lift the country out of its longest recession since World War II could spur inflation later on.
“It is important to ure the public and the markets that the extraordinary policy measures we have taken in response to the financial crisis and the recession can be withdrawn in a smooth and timely manner as needed, thereby avoiding the risk that policy stimulus could lead to a future rise in inflation,” Bernanke said. “We are confident that we have the necessary tools to implement that strategy when appropriate.”
The Fed chief also sought to beat back an Obama administration proposal that would create a new consumer protection regulator for financial services and strip some of those duties from the central bank.
Consumer groups and lawmakers have blamed the Fed for not cracking down early on dubious mortgages practices that fed the housing boom and figured into its collapse. Later this week, the Fed will issue a proposal boosting disclosures on home mortgages and home equity lines of credit. It also will include new rules governing the compensation of mortgage originators.
Bernanke also urged Congress to keep proposals to audit the Fed away from monetary policy duties. “A perceived loss of monetary policy independence could raise fears about future inflation,” he warned.
To revive the economy, the Fed has plowed trillions into the financial system in an effort to drive down rates on mortgages and other consumer debt. It also has created programs to bust through credit clogs, a key ingredient to turning the economy around.
When the time comes, the Fed will need to soak up that money.
Besides raising its key bank lending rate, the Fed can raise the rate it pays banks on reserve balances held at the central bank, Bernanke said. That would give banks an incentive to keep their money parked there, rather having it flow back into the financial system, where it can stoke inflationary pressures. The Fed also can drain money from the financial system by selling securities from its portfolio with an agreement to buy them back at a later date or it can sell securities outright.
Steering the economy from recession to recovery will be a delicate move for Bernanke — economically and politically.
On the economic front, Bernanke repeated the Fed’s forecast that the economy should start growing again in the second half of this year, but he warned growth would be slight, leading to higher unemployment.
Despite some improvements — including a stabilization in consumer spending and moderating declines in housing activity — the economy remains vulnerable, he said.
“Job insecurity, together with declines in home values and tight credit, is likely to limit gains in consumer spending,” Bernanke said. “The possibility that the recent stabilization in household spending will prove transient is an important downside risk to the outlook.”
The nation’s unemployment rate climbed to a 26-year high of 9.5 percent in June. The Fed says it could rise as high as 10.1 percent this year, and stay elevated into 2011. The post-World War II high was 10.8 percent at the end of 1982, when the country had suffered through a severe recession.
Expectations for a lethargic recovery should keep a lid on inflation this year, Bernanke said. With consumers likely to stay cautious amid rising unemployment, companies won’t be able to jack up prices.
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20 Responses to “Ron Paul You Created This Crisis”
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I think folks are …
I think folks are starting to listen to Dr. Paul, but they are scared less as to what he says… maybe time to get the pitchforks and hangin ropes out of the barn and head to DC…
PLEASE run in 2012 …
PLEASE run in 2012 Ron, you’re our last hope!!!!!
you know in the …
you know in the Health Care Chart there will be a program set up which states ‘Federal Mandates for Web design’
do you know what this means? Yes, it means the 1st Amendment is NO MORE!
Ron Paul cured my …
Ron Paul cured my apathy!!!!!!!!!!!!
The only one with a …
The only one with a brain who is willing to tell the truth - thank God for youtube because the media slapped Ron in the face in the last election - he got my write in vote .
I am a Ron …
I am a Ron Paublican.
RP2012
Ron Paul’s got my …
Ron Paul’s got my vote
please run for …
please run for president ron paul
vote Ron Paul ‘12 . …
vote Ron Paul ‘12 ….
mortgageartist. com …
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Greetings from …
Greetings from Sweden. I like Ron Paul A LOT!!! If I were an American citizen I would have done everything to put him in the White House. I am absolutely convinced that when the economy collapses together with the current administration, Ron Paul will be among those in the new government who can restore the United States of America to it’s former glory! Hang in there people, reclaim your constitution! USA may lose it’s position as an empire - but NEVER as one of the greatest nations on Earth!
Bernanke knows he …
Bernanke knows he is firing the economy into the crapper. Nothing happens by accident with people in money and power. The sheeple are stupid to believe the muse, but it sure is entertaining to watch the masses’ emotions rise and fall based on the drama generated by the Fed, to mask what they’re really doing.
Bernanke gives me …
Bernanke gives me the creeps… Why does he even bother sitting there when he clearly doesn’t give a ? Who’s Bernanke think he’s kidding? Probably get’s off on watching one of America’s only credible politicians actualy telling him how precisely his real agenda is progressing…
Sickening…. and that sh!t eating grin…
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August 20th
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Another victory for …
Another victory for Ron Paul and the truth !
Ron Paul 2012
…
Ron Paul 2012
You’ve already won my vote Ron.
Boy, Ron Paul …
Boy, Ron Paul slapped Bernanke in the face with his giant clankers, didn’t he?
audit them, and …
audit them, and then put them in jail!
i cant get enough, …
i cant get enough, ever! its abslolutely f**kin brilliant its actually going exactly to plan. The best part is late at night, when bernanke’s layin in bed with that BIG S**T GRIN on his face, he knows that by “sitting there” taking in there ranting and complaining, and then answering with ?????? whatever they call it, its ALL that will Ever happen. So Good Luck everyone…
What day is this …
What day is this from?