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Ellen Brown: Bernanke's Cheerleader by Gary North

For the record, I like fellow attorney and Fed-exposer Ellen Brown. Her book Web of Debt is a very good read that makes the case for ending the Federal Reserve. She has her own ideas about what to replace The Fed with. I have defended here several times against Gary North's attacks.

However, now she is defending QE2 and I stand with Mr North on this issue.

Ellen Brown has just switched sides. Instead of becoming an Austrian School critic of the Federal Reserve, she has become its cheerleader.

In my criticism, I kept saying that she is a leftist. She wants a welfare State funded by zero-interest loans from the government. She wants a big Federal government. She does not care how we get it. Now that the FED will inflate enough to pay for it, she has switched sides. Her primary commitment was always to the welfare State, not the battle against the FED.

In my detailed critique of her economics, I made it clear that she was never a conservative. Now she proves it. She praises Bernanke and the FED. She says that QE2 is not fiat helicopter money, and that Bernanke is not "Helicopter Ben," which he obviously is.

Hard to believe? Let me quote her.


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Ellen Brown Responds to Mr. North

Response to Gary North: QE2 IS the Populist SolutionGary North, who purports to be an expert on the errors in my book “Web of Debt,” has evidently not actually read it. In an article posted on the Market Oracle on November 23, he says that in calling QE2 a “bold precedent,” I have switched sides. He apparently missed the chapter I wrote on this subject, first published in “Web of Debt” in 2007, saying exactly what I am saying now.

The Federal Reserve is finally using its “quantitative easing” (QE) tool to good purpose, and I’m endorsing that, not just for our central bank but for any central bank anywhere that would be so bold. We are trapped in a web of debt devised by an international banking cartel that has hoodwinked us into believing that we have no recourse but to use money created by their banks as loans. We do have recourse. Money today is simply a legal agreement, an acknowledgment of services performed and debt owed. Every country can and should issue its own money and its own national credit. This would NOT inflate prices, for reasons I have explained again and again. If “money” originates as a receipt for goods and services delivered to the government — rather than in speculative leveraging by banks not attached to real productivity — supply and demand will increase together, and prices will remain stable. If the money supply increases beyond GDP, the excess can be taxed or otherwise drawn back to the government.


QE2 is not quite replacing taxes with money printed up by the government, but as I wrote in the article criticized by Mr. North, in our current system it is the functional equivalent and the next best thing. The Fed is funding the federal deficit by buying long-term government bonds with money created with a computer keystroke, and the Fed rebates its profits to the government after deducting its costs, so this funding is nearly interest-free. These bonds never have to be paid back, because the federal debt is never paid back. An interest-free debt rolled over indefinitely is the functional equivalent of debt-free, government-issued money.



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"If the money supply increases beyond GDP, the excess can be taxed or otherwise drawn back to the government."

That's a pretty big "if" and "can." Allows a lot of discretion to a lot of unsavory characters.

Did Ben promise Barry funding for healthcare for appointment?

How else could Barry promise funding until 2013, the end of Bernanke's four year term a Chairman of the Fed.

"On August 25, 2009, President Obama announced he would nominate Bernanke to a second term as chairman of the Federal Reserve."

Free includes debt-free!

Gary North is usually spot

Gary North is usually spot on.. except for the y2k thing.. Did any of you know that North worked for Ron Paul in 70's?

I am not sure Gary was all wrong about Y2K


Follow the blue line. Nine years of negative economic growth since 2001. The economy is barely four-fifths of what it was in 2000. And it still is loaded with fluff and false promises waiting to fall.

My guess is that another fifth will fall if the Fed Res follows through.

Free includes debt-free!

thanks for the link,

I think the current economic crisis should offer the public as a "philosophical crucible," if you will, in discerning who really gets the economic reality vs. theory, who actually has a track record of being correct on the issues vs. who has not.

I too, am with Gary on this one.

One other person that I used to have tremendous respect for is Bill Still, the director and producer of the Money Masters, which in my opinion is a must viewing for anyone who seeks to truly understand the entire concept, history and origin of money.

having said that, Still's latest film Secret of Oz is sounding more like Ellen Brown, than Ron Paul.

Regardless, everyone should be exposed to their works, if nothing else, as a reference point; it will facilitate putting various economic memes into their proper context.