FED TO BUY $300 BILLION OF TREASURIES - QUANTITATIVE EASING ALERT! (user search)
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  FED TO BUY $300 BILLION OF TREASURIES - QUANTITATIVE EASING ALERT! (search mode)
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Author Topic: FED TO BUY $300 BILLION OF TREASURIES - QUANTITATIVE EASING ALERT!  (Read 6022 times)
opebo
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« on: March 18, 2009, 03:15:21 PM »

So are there any upsides to the dollar collapsing? Maybe more manufacturing?

There are no positives results to this scenario.  Period.

Well, except for complete economic recovery through reflation.

Oh and btw, I told you so.  My economic views are apparently shared by those in control of the Fed.
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opebo
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« Reply #1 on: March 18, 2009, 03:19:26 PM »

Oh and btw, if the dollar falls much (it won't), everyone else will just have to quantitatively ease (print) to equalize - they have no choice.
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opebo
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« Reply #2 on: March 18, 2009, 03:57:21 PM »

Opebo and Jmfcst agreeing on economics, cats and dogs living together...MASS HYSTERIA

The dude may be mad as a march hare in many ways, but certain aspects of his economic views are sensible.

I even agree that this quantitative easing should have been much larger in size...
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opebo
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« Reply #3 on: March 19, 2009, 03:33:05 AM »

Opebo and Jmfcst agreeing on economics, cats and dogs living together...MASS HYSTERIA

Actually, it tells me something as well...

EDIT:  Well, it tells me that ( Wink to myself), but it tells me something more important - wait patiently and prepare.

look...though you and opebo have totally different economic viewpoints, both of your viewpoints never change, regardless of market conditions.  Both of you are willing to play chicken with icebergs.  I, on the other hand, am willing to temporarily change course in order to save the ship.

Actually while my economic ideology doesn't change, my policy prescriptions do change quite often.

For example massive printing is the obvious action in a deflation, and always works very well.  Bernanke is good.  It is absurd to compare this to the Weimar or Zimbabwe cases as the situation is entirely different.

I don't recommend this sort of printing in normal times, though obviously a continuance of some milder Keynesian redistribution is always necessary.  During 'normal' 'market' operation, it is better to tax said monies from the privileged to provide for redistribution (along with several other ways).  The printing aspect is the medicine for deflation/depression, not the daily tonic in normal times.

That said, one aspect of this Bernanky printing I don't like is that the money goes to holders of securities - the very class which will not spend/cannot spend.  We need to print a trillion or two and get it directly into my hands and the hands of people like me.
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opebo
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« Reply #4 on: March 19, 2009, 04:41:47 PM »

I would also submit that BB's thesis "fails" because you can't solve a "debt-deflation" with more "debt".  QE is just the last step in the game.

Printing cancells the debt, Sam Spade.
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opebo
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« Reply #5 on: March 24, 2009, 03:38:27 PM »

Yields don't matter much.  In a depression, people's borrowing or lending/investing behaviour will not be effected by a difference of a couple percentage points.  Their behaviour is entirely controlled by fear.

The purpose of quantitative easing, it seems to me, is to create large amounts of new demand out of nothing (in other words replace the demand that is lost by depression psychology), thus putting idle capacity to work.  Interest rates have little to do with this.
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opebo
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« Reply #6 on: March 24, 2009, 03:49:59 PM »

Changes in yields reflect people's willingness to save, rather than cause them. So I think Sam's point is rather the old monetarist interpretation of Lincoln: you can fool all of the people some of the time and some of the people all of the time but not all of the people all of the time.

Yes, there is certainly no shortage of savings in a depression.

I like that old Keynesian chestnut 'pushing on a string' myself.
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