The Fed Must Abandon “Quantitative Easing”

Or money printing, as it really should be know – from the Wall Street Journal:

A group of prominent Republican-leaning economists, coordinating with Republican lawmakers and political strategists, is launching a campaign this week calling on Fed Chairman Ben Bernanke to drop his plan to buy $600 billion in additional U.S. Treasury bonds.

“The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment,” they say in an open letter to be published as ads this week in The Wall Street Journal and the New York Times…

And, of course, they won’t achieve their stated objective – ie, higher employment. But what if that is not the real objective? What if the objective is to just devalue our currency until the debt we have outstanding becomes next to worthless? Sure, this would ruin the middle class, but the rich would be fine, the poor would be no poorer than they are now and, most important, Big Government would be out of debt and thus able to resume growing.

Why think like that? Because I can’t imagine that Bernanke is really that much of an idiot. I mean, come on! He tried trillions of this last year and it gave us absolutely nothing. Europe is back on the cusp of sovereign default, China is getting hit with inflation as a precursor to their collapse, Australia’s housing bubble has finally burst…everything is going to heck in a hand basket, and Bernanke wants to print more money? What for? Even if it “worked” it wouldn’t work because the global economy is about to go in to a tailspin – and we already know by recent experience that it won’t work. And, so – I do wonder if the plan is just to get rid of debt by making US paper worthless…

I am glad that some GOP lawmakers are taking a hard look at Fed policy, but we’ll have to see if there’s any follow through. We must audit the Fed and, in my view, abolish it – but, at the least, audit it. Find out where the money has gone. And establish some Congressional controls over monetary policy (yes, I know; Congress is filled with idiots, too…but idiots we can fire every two years, unlike the Fed). We really need to get a handle on this – sincere belief in Keynesianism or sick plan to screw our creditors, the end result will be the same: utter disaster.

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