Economics, as a branch of the more general theory of human action, deals with all human action, i.e., with mans purposive aiming at the attainment of ends chosen, whatever these ends may be.--Ludwig von Mises
Wednesday, November 10, 2010
The Mogambo Guru writes:
The thing that has sent me into Mogambo Panic Mode (MPM) over the terrifying inflationary implications is the latest outrage from the Federal Reserve, reported at Bloomberg.com as, “The Federal Reserve will buy an additional $600 billion of Treasuries through June, expanding record stimulus and risking its credibility in a bid to reduce unemployment and avert deflation.”
It turns out that the announced $600 billion, in six measly months, as perfectly horrific as it is, is not the whole story, as we later find out when Bloomberg later in the article reports, “Including Treasury purchases from reinvesting proceeds of mortgage payments, the Fed will buy a total of $850 billion to $900 billion of securities through June, or about $110 billion per month, the New York Fed said in accompanying statement.”
$110 billion per month! Per month! Per freaking month! Gaaahhhh!...
In case you were wondering, the purpose of the QE program is to create the money that the government needs to borrow this year. Otherwise, the Treasury has to try and sell $2 trillion in bonds to the few people who have saved some cash money, but it is ludicrous to think that these few people could possibly come up with $2 trillion! Hahaha!
And then more next year, and the year after, and the year after! Hahaha! Insane!
And if you think that this will not end Very, Very Badly (VVB), then I am pretty sure that I am on safe ground to say that you don’t know squat about economics. I say this without fear of contradiction for two important reasons...
And I also say this without fear of contradiction because there is not one example in the last 4,500 years – 4,500 years! – where any of the thousands and thousands of corrupt, dirtbag governments that borrowed themselves into such overwhelming bankruptcy and/or created so much new fiat money to spend that had ever, ever, ever, either magically or miraculously, succeeded in preventing total disaster by (unbelievably) creating, borrowing and spending more money!...
To even suggest otherwise is Sheer Freaking Lunacy (SFL), and if you do, then you will be shunned by decent people and end up in the gutter, career-wise, writing about economics for The New York Times or be a laughable egghead university professor at Princeton (“Them that can, do, and those that can’t, teach, or end up as chairmen of the Federal Reserve where they can prove that they can’t, but they thought they could because they were willingly gullible halfwits who could not see the utter stupidity of their preposterously simplistic neo-Keynesian econometric crapola of equations and computer models, which is such an absurd idea that it makes me guffaw in a Loud Mogambo Laugh Of Scorn (LMLOS) for Ben Bernanke, Paul Krugman and all the lowlifes who agree with either of them about anything.)”