Post by unlawflcombatnt on May 17, 2014 9:07:24 GMT -6
Once again, 1 of our economy's former bubble-blowers is making a turnaround, and warning of economic danger from current economic policies.
This time it's Larry Summers, who is [correctly] warning of the danger of continuing current low Fed interest rates.
Even better, Summers is stating that current, trickle-down monetary policy (i.e., the faux pump-priming of pouring money into the pockets of rich bankers & financiers thru bond purchases), is NOT the best way to stimulate the economy.
Who would have thunk it?!
Giving rich people money doesn't necessarily help the economy??
Giving rich people money doesn't always cause them to hire more workers???
Really?
No way!
from moneynews.com
www.moneynews.com/Personal-Finance/Summers-Fed-interest-rates/2014/05/16/id/571750/?ns_mail_uid=80659729&ns_mail_job=1569505_05162014&promo_code=jli6irus
Larry Summers:
Fed's 'Low Interest Rates Could Become Source of Instability'
Fri, May 16, 2014
by Dan Weil
"Harvard economist Larry Summers, a former top adviser to President Barack Obama, is concerned that the Federal Reserve's easing program could hurt the economy.
"Low interest rates could become a source of instability down the road," Summers said at the SALT investment conference Thursday, Fortune reported.
The Fed's federal funds rate target has stood at a record low of zero to 0.25% since December 2008.
Low interest rates could cause bubbles in asset markets, Summers noted. Thus he advocates increased government spending for areas like infrastructure rather than massive monetary stimulus.
In addition to its low interest-rate policy, the Fed is still buying $45 billion of Treasurys and mortgage-backed securities a month.
The central bank's accommodative policy is probably worsening income inequality by supporting wealthy stockholders more than others, he explained. "A policy that works by pumping up asset prices is not going to be egalitarian."...
James Rickards, managing director at Tangent Capital Partners, sees the dollar headed for crisis. Central banks are petrified of deflation, the author of "The Death of Money: The Coming Collapse of the International Monetary System" told Bloomberg TV.
So how do central banks prevent deflation? "They print money," Rickards said. "If you print enough money, you will collapse confidence in the dollar. The ultimate backing of the dollar is confidence.""
This time it's Larry Summers, who is [correctly] warning of the danger of continuing current low Fed interest rates.
Even better, Summers is stating that current, trickle-down monetary policy (i.e., the faux pump-priming of pouring money into the pockets of rich bankers & financiers thru bond purchases), is NOT the best way to stimulate the economy.
Who would have thunk it?!
Giving rich people money doesn't necessarily help the economy??
Giving rich people money doesn't always cause them to hire more workers???
Really?
No way!
from moneynews.com
www.moneynews.com/Personal-Finance/Summers-Fed-interest-rates/2014/05/16/id/571750/?ns_mail_uid=80659729&ns_mail_job=1569505_05162014&promo_code=jli6irus
Larry Summers:
Fed's 'Low Interest Rates Could Become Source of Instability'
Fri, May 16, 2014
by Dan Weil
"Harvard economist Larry Summers, a former top adviser to President Barack Obama, is concerned that the Federal Reserve's easing program could hurt the economy.
"Low interest rates could become a source of instability down the road," Summers said at the SALT investment conference Thursday, Fortune reported.
The Fed's federal funds rate target has stood at a record low of zero to 0.25% since December 2008.
Low interest rates could cause bubbles in asset markets, Summers noted. Thus he advocates increased government spending for areas like infrastructure rather than massive monetary stimulus.
In addition to its low interest-rate policy, the Fed is still buying $45 billion of Treasurys and mortgage-backed securities a month.
The central bank's accommodative policy is probably worsening income inequality by supporting wealthy stockholders more than others, he explained. "A policy that works by pumping up asset prices is not going to be egalitarian."...
James Rickards, managing director at Tangent Capital Partners, sees the dollar headed for crisis. Central banks are petrified of deflation, the author of "The Death of Money: The Coming Collapse of the International Monetary System" told Bloomberg TV.
So how do central banks prevent deflation? "They print money," Rickards said. "If you print enough money, you will collapse confidence in the dollar. The ultimate backing of the dollar is confidence.""