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Hosea 4:6 My people are destroyed for lack of knowledge…

Posts Tagged ‘private federal reserve manipulating markets’

The Federal Reserve Has Failed Miserably

Posted by truthpills on 2010/01/27

Posted by Larry Doyle on January 25, 2010 8:46 AM

How are we to judge the Federal Reserve? The Fed by its very nature has been an opaque institution. What truly goes on behind the closed doors of the Fed? What are the relationships amongst the Fed Chair and Fed governors? How about the relationships between Fed representatives and political operatives?

While volumes have been written about the history of the Fed, to the American public the Federal Reserve remains a mystery. How can we lift the veil on this mysterious institution? Let’s “kiss” the Federal Reserve. What? Oh no, LD, where are you going with this? Let’s plant a big “kiss” on the Fed. That is, keep it simple stupid.

What are the mandates of the Federal Reserve? In the Fed’s own words, the primary mandate of the Federal Reserve from its inception in 1913 has been:

“conducting the nation’s monetary policy by influencing the monetary and credit conditions in the economy in pursuit of maximum employment, stable prices (LD’s emphasis), and moderate long-term interest rates.”

How is the Federal Reserve doing in pursuit of these stable prices? Thanks to Michael Panzner who, in my interview with him last evening on NQR’s Sense on Cents with Larry Doyle Welcomes Back Michael Panzner, pointed out that the Fed has failed miserably in its pursuit of stable prices. Panzner specifically highlighted that the dollar has lost 95% of its purchasing power since the Federal Reserve was founded in 1913.

I will admit that I found that number shocking! Major high five to a loyal Sense on Cents supporter who listened to last night’s show and then did a little homework of his own to check Panzner’s statement. He wrote to me after the show and provided an interesting link. What do we learn from The Inflation Calculator?

What cost $1000 in 1913 would cost $21520.32 in 2008.
Also, if you were to buy exactly the same products in 2008 and 1913, they would cost you $1000 and $47.10 respectively.

Rest assured, the Fed would spin this number so hard that America would vomit from the motion sickness. The Fed’s excuses may only be rivaled by the nation’s middle school students who lost their homework to the voracious appetite of the family dog.

Regardless of how anybody spins it, a grade of 5 (we’ll round the 4.7 up) is a failure. Are greater failures approaching Zimbabwean magnitude to come?

Might the members of Congress care to question Mr. Bernanke on this? No dog excuses allowed.

Thank you Mr. Panzner for bringing this to our attention. Thank you WB for verification.

What do you think about the Fed now?
Reference

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BLATANT Monetization Uncovered

Posted by truthpills on 2009/08/08

Thursday, August 6. 2009
Posted by Karl Denninger in Federal Reserve at 16:52

Remember the Dallas Fed’s Fisher saying that “The Fed will not become the handmaiden of Treasury”?
He was lying (The Fed already has), and now there is proof.
Mad props to both Zerohedge and Chris Martenson for noticing this; I missed the facts buried in the CUSIP list.
The upshot: The Fed bought nearly half of LAST WEEK’S 7 year Treasury Issuance TODAY.
Huh? Remember, after the 5 year auction that went badly (and which I wrote about) the 7yr auction went “well.” Rick Santelli (and a lot of other people) agreed – demand was strong. That made no sense to me at the time, coming one day after a near-failure in the 5 year.

Well now we know what happened: The Fed pretty clearly pre-arranged, either explicitly or by “suggestion”, that the Primary Dealers take up the auction with the promise that The Fed would immediately monetize half what the Primary Dealer’s took!

Folks, this is beyond bad – it is pernicious and outrageous conduct by The Federal Reserve in conspiracy with the Primary Dealers, both of which are now desperately trying to prop up the US Government Bond Market through subterfuge rather than just buying up the bond issue from Treasury when originally put to the market!
Read the full article

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Rise in Rates Jolts Markets

Posted by truthpills on 2009/05/28

By LIZ RAPPAPORT

Treasury yields and mortgage rates surged Wednesday to their highest levels since November, dealing a blow to the Federal Reserve’s efforts to stimulate the economy by keeping borrowing costs low.

The Fed has made low mortgage rates a priority in its strategy to stem the U.S. recession. To achieve that, the central bank has been buying mortgage-backed securities and Treasurys. Through programs announced since last fall, it has bought more than $460 billion of mortgage-backed securities and more than $125 billion of Treasury bonds.

But the winds turned against the Fed in recent days, as investors worry the government’s approach could lead to inflation.
Read the full article

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