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Bernanke reinvents central banking as central planning.

By Michael Brendan Dougherty

Ben Bernanke doesn’t look like a revolutionary. The Federal Reserve chairman has the dry, affectless manner of a timid researcher even as he rings in sweeping changes to monetary policy. He makes his actions seem qualified, tentative, easily revisable. But make no mistake: Bernanke is remaking the Fed from a mere central bank into an all-purpose policy tool.

All it took to send the dollar plummeting below parity with its Australian namesake on Oct. 15 was a few bland words from Bernanke, delivered at the Federal Reserve Bank of Boston. After agreeing that there should be “limitations” on the Fed’s “nonconventional” strategy for zero interest rates, and allowing that his critics have “understandable concerns” about inflations, he announced flatly, “there would appear—all else being equal—to be a case for further action.”

That set financial pundits squawking—“it’s what the market wants!”—and prompted goldbugs to hit “publish” on their “Gold $2,500?” articles. Fed watchers began to contemplate what it meant for the largest holder of American debt to announce that it will be in the market for even more debt. Bernanke had effectively proclaimed that the emergency measures the central bank employed during the crash of 2008 would now be standard practice. A New Fed was being born.


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This published comment is

This published comment is from the National Inflation Assn. I have excerpted :

America no longer has a free market economy. For everybody on Wall Street to be so fixated on the words that come out of Bernanke's mouth, it shows that the economic system we have is extremely fragile and vulnerable to collapse at any time. With prices of assets soaring in recent months just in anticipation of Bernanke's quantitative easing announcement, it shows that the world's financial system is already flooded with trillions of dollars in excess liquidity. Unless the U.S. government immediately implements dramatic spending cuts across the board, NIA believes the world is going to lose confidence in the U.S. dollar and it will be impossible for the U.S. to survive past the year 2015 without the U.S. dollar becoming worthless.

The fact that the Republicans took control of the House of Representatives last night is completely meaningless. If the U.S. government is to implement the spending cuts necessary in order to prevent hyperinflation, Americans will be faced with a second Great Depression, which NIA believes is a necessity and much better than the alternative. However, the Republicans will not risk being held responsible for the next Great Depression, because it will ensure Obama gets reelected in 2012. Therefore, NIA predicts that nothing is going to change with the Republicans taking over the House.

The only good news that came so far this week is that Rand Paul was elected to the U.S. Senate. NIA predicted in our top 10 predictions for 2010 that Rand Paul would win both the Republican nomination for U.S. Senate in the State of Kentucky and the U.S. Senate seat and we are very proud that Rand Paul was victorious. NIA considers Rand Paul to be the true leader of the Tea Party movement because he fully understands the hyperinflation that awaits as a result of the Federal Reserve's actions.

NIA hopes to see Rand Paul filibuster any attempts by the U.S. Senate to raise the ceiling on our national debt. There is no reason to have a national debt ceiling if every time we reach it, Congress raises it. NIA prays that Rand Paul proposes a Balanced Budget Amendment in 2011, because this should be our government's top priority if it wants to restore confidence in the U.S. dollar and prevent a complete societal collapse.

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