Predicting the Future - QE3???

[ATOMonkey]

What say the ingo? Will there be a QE3? Bernanke says no, JPM says no, lots of analysts say Benny will crank up the printer to save face in the coming election.

 

[rambone]

Not if, but when.

 

[dross]

They've got to. To refrain admits failure for the first two times, and it's the only tool they've got. They have no control over the only things that will help the economy right now, which of course is to cut taxes and spending.

Freeze spending to 2008 levels, cut the marginal income tax rates by 10%, eliminate the corporate income tax and the capital gains tax, and we'll all be in fat city in three or four years.

And then I woke up.

 

[ArmedProgrammer]

Actually they will try the McTwist... They will play long tern interest rates against short term ones by selling one and buying the other. This will flatten the crap out of the yield curve. If not invert it - hence the McTwist.

The Fed's running out of tricks here, folks.... They're trying to jawbone the politicians into cutting spending - but that would make too much sense for DC to do...

 

[Westside]

Big O said that if we spend enough that the economy will fix itself. SO between QE3 and George Bush admitting he screwed the country all will be well and fix the world not just the US. I plan to rack up millions in credit card debt to help him. because once i have enough i will be to big to fail.

 

[Ash]

Of course there will be a QE part 3. Just a matter of time. Actually, the debt is lagging.
[URL]http://www.chrismartenson.com/blog/death-debt/58941[/URL]

 

[spencer rifle]

Welcome to Keynesian hell. Where is our savior Heyek?
When all you have is a hammer...

 

[futureofwar]

It will happen either that or just a flat out government bailout for the government prolly round august

 

[edsinger]

It will be called something different, but we will buy more of our own debt.

 

[ghunter]

My 12 year old told me that Obama will be on the 1 trillion dollar bill. I think my kid should run the Fed just long enough to kick everyone out and turn the place into a Bass Pro Shop.

 

[RockofStrength]

They'll wait until it's a bit closer to election time to boost things, I think. Gotta make sure the sheeple remember who feeds 'em.

 

[Stschil]

They will have no choice, in their twisted Keynesian minds. Once the Fed stops buying Treasury Bonds with monopoly money, they won't be have credit to lend out to the banksters. When the banksters have no money to lend to people, they have no money coming back in in the form of interest and the can't pay back the Fed. Thus interest rates will spike, because the banisters and the government CANT do without. End result, the People get screwed either way. Quagmire Economy 3 is about as unavoidable as a mean case of the runs after drinking the water in Mexico.
The Bernank knows it, OBamesieh knows it and so does Little Timmy G. They will wait until the consumers start feeling the squeeze and crying about it, then open the flood gates with new money, just in time for the Bammer to look like a hero. It will stave off a major crash until his third year, they think, and by that time, who cares? He's got his lifetime pension, his library funding, his protective detail and he go live in a compound with Dick Daley, Tony Rezco(after the inevitable Presidential Pardon), and Blago, safe and sound, guarded 24/7 by JBT's paid for by our tax dollars.

 

[mrortega]

I don't know if it will happen but I'll wear Coates' and Lugar's ears out screaming not to do it. Same with my House rep. We don't need any more money pissed away to states with big socialist cities that have ruined themselves with their lib policies.

 

[ArmedProgrammer]

Agree with you mrortega... I fear that you'll wear your vocal cords out before you wear their ears out.... But good on you for trying!

 

[ocsdor]

I believe there is a group of people in Switzerland meeting right now discussing QE3 (and other NWO items).

Paul Joseph Watson Breaks Down The Full Official Bilderberg 2011 Attendee List

http://www.prisonplanet.com/major-swiss-newspaper-gives-bilderberg-front-page-coverage.html

 

[John Galt]

What an exciting time we live in, America's turning point. Either we start turning this trainwreck around or it runs off the cliff, as we Americans have never really done anything half-a$$ed! Buckle up people, it's gonna be a wild ride

 

[jblomenberg16]

What an exciting time we live in, America's turning point. Either we start turning this trainwreck around or it runs off the cliff, as we Americans have never really done anything half-a$$ed! Buckle up people, it's gonna be a wild ride

Yep...get on board and be ready to ride it all the way to the end of the line.

Interest rates going up might sound bad, and be painful too in the short term, but is probably part of what needs to happen.

1) It allows people to earn value on REAL investments...such as savings accounts, CD's, etc. rather than dirivatives and other ways of investing these days.

2) As a result of 1, It should help boost the national savings rates, as rates in the US are much much lower by comparison than many of our peer countries.

3) It begins to discourage folks from using the relatively inexpensive credit they have today to live beyond their means.

4) As a result of 3, people will begin to pay with real money again for many of the items that are being paid for on credit today. I'm not talking large purchases like cars and houses (although paying cash for those is more feasible than many people realize). I'm talking about everyday purchases of non-durable goods. Rather than continue to exponentially put credit back into the system, you put cash money back into the system when you purchase something.

5) 3 and 4 help create value for the dollar again, since the "dollar" is no longer a product of multiplied credit, but actually tied back to real items of value.



I had a Global Econ professor in MBA school that spent a lot of time talking about the ability of credit markets to "Create Money." Just like the link a few posts above shows, our credit markets have created money for years by a fairly simple principle call Fractional Banking.


Bank A has $1000 in deposits, so decides to loan out $900 of that and keep $100 in reserves. Lets say Bank B gets all of the $900 in deposits as the $900 is spent in local businesses. Bank B puts $90 in reserves and loans out $810 other people, or maybe even to Bank C. Bank C decides it is going to Keep $81 in reserves, and loans John Doe $729. It continues from tehre.

Each bank has kept 10% in reserve, and loans the rest out. Instead of the original $1000 in deposites, they've actually "created" $900 + $810 + $729, or $1439 in "new" money. The $1000 that started in Bank A's deposits has appeared to have grown to $2439, when in reality, there is still only $900 of the original $1000 in circulation.

For a better academic description, here is a good read. Figure 2 on Page 11 of the PDF has a nice diagram of this effect.
http://ecedweb.unomaha.edu/ve/library/hbcm.pdf

Imagine this happening with Millions of Dollars a day, and it is easy to see how quickly we can build a house of cards that has no option but to fail if left unchecked. Take one leg out of the loop and suddenly there isn't anyway for all of the debt to be paid, as at each step, the debt is owed to someone else.


Don't forget, though, that in many cases, creditors do make money in the process on the phoney money they lent out. Oh, and they get to take the stuff you bought with thier phoney money if you can't pay for it and go into default. See anything fishy about all of that?

 

[John Galt]

Combine the above scenario with a sociopathic money printer in charge of the Fed and a Congress willing to obligate generations of taxPAYERS to back unsustainable debt/programs. The situation looks grim for a country with open borders, a printing press and a welfare state fostered on a government-educated society.