The Other McCain

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Paul And McCotter Grill Bernanke On Inflation, Which Is Unexpectedly Higher Than Bernanke Will Admit

Posted on | March 1, 2012 | 12 Comments

by Smitty

It is blatantly obvious to the most casual observer that Ron Paul’s insistence on honest, tangible cash removes him from consideration for President as much as his foreign policy. Paul is trying to make a serious legal tender argument, and Bernanke glibly deflects the question:

The wild, irrationally exuberant Thaddeus McCotter ejaculates almost spasmodically on the topic of people who have money in savings accounts currently being devoured by inflation:

A paraphrase:
Bernanke points out that people could have put their money in the stock market, and repeats the mantras that the economy is recovering, monetary policy is set for recovery, inflation is kept low and stable. McCotter replies that the Federal Reserve is investing public money stupidly. A hurt-sounding Bernanke replies that while the Federal Reserve may be incompetent, the Fed is all that we have.

The American Institute for Economic Research points out that, for those with sense, inflation is roughly 8%. This gets at Paul’s point in the clip above that our government, if not lying outright, at least is not communicating usefully about economic realities. Even the most rectal-sunshine-loving folks on the Left have got to be getting sick of this nonsense.

via Zero Hedge, the Blaze, and the Lonely Conservative

Update: oh, hey, this sounds really cool. Foreign banks will now start inflating the Dow in a big way. What could possibly go ronngg?

Update II: linked at The Rio Norte Line, who comes up with the instantly classic “Zimbabwe Ben”.


12 Responses to “Paul And McCotter Grill Bernanke On Inflation, Which Is Unexpectedly Higher Than Bernanke Will Admit”

  1. Report: Real Inflation is 8% | The Lonely Conservative
    March 1st, 2012 @ 6:53 pm

    […] it to get better any time soon, and if Obama is reelected it will only get worse.Update: Linked by The Other McCain where you can find video of Reps. Ron Paul and Thaddeus McCotter grilling Ben Bernanke about […]

  2. Say What? Foreign Central Banks Buying US Stocks? | The Lonely Conservative
    March 1st, 2012 @ 7:11 pm

    […] reset is finally approaching.Read the whole thing, but first you may want to pop a few Tums.H/T to Smitty Tweetvaso linkTags: central banks, Federal Reserve, stock market, us This entry was posted on […]

  3. Adjoran
    March 1st, 2012 @ 7:56 pm

    It is outrageous to suggest people should have their savings in equities.  That is fine up to a point for younger people who already have an emergency cash reserve.  But people at or nearing retirement age should avoid volatile investments like equities in favor of more secure instruments like bonds and CDs.  Any financial adviser will tell you this.

    Bernanke is advising seniors to take unwise risks, and penalizing savers who do not.

    Neither CPI nor the AIER numbers measure inflation.  They are measuring prices, which can be an indicator or result of inflation.

    Actual inflation would be the amount the money supply has increased beyond that necessary to replace worn out currency and keep pace with growth.  Why no one does these calculations is a mystery (it should be a core function of the Fed), but my guess is it is closer to 20% over the last two years.  It just hasn’t shown up in prices yet because of the shell game the FRB is playing with “quantitative easing” (buying bonds with no money – I tried this on gasoline, it doesn’t work at all).

  4. Pathfinder's wife
    March 1st, 2012 @ 8:04 pm

    Have to admit: when Ron is on with the fiscal sanity; he makes me consider voting for him.
    If only, if only…

  5. Charts ‘o the Day – 2000-2012 Gas Prices at the Pump and Inflation « The Rio Norte Line
    March 2nd, 2012 @ 12:39 am

    […] Smitty at The Other McCain has Zimbabwe Ben here trying to ‘splain it to us. 55.957870 -3.199357 Share this:FacebookEmailPrintRedditTwitterStumbleUponDiggLinkedInLike this:LikeBe the first to like this post. Posted in: Economy/Economics ← S’Long Andy–an ode to Andrew Breitbart, 1969-2012 Rule 5: Aussie Hotness – Jennifer Hawkins → Be the first to start a conversation […]

  6. CPAguy
    March 2nd, 2012 @ 12:55 am

    Inflation is fairly low right now, particularly given the growth in the money supply.

    The reason for this is primarily because the new money isn’t actually out in circulation but is sitting in banks, at the FEDs insistence, so that they maintain certain ratios of cash, assets, and liabilities.

    It is not necessarily the price level one should look at, but the cost of living.

    The rapid technological increase of the past 20 years have made achieving a relatively good standard of living available to most Americans (which is leaps and bounds above 99.9% of other countries).

    Gas and food are going up, but ones ability to connect to the world of news and entertainment is getting cheaper by the day, electronics and home necessities are also cheaper.

    The problem isn’t with today’s inflation, but tomorrow’s.

    America’s debt becomes unsustainable once interest rates go up a few percentage points.

  7. BruceC
    March 2nd, 2012 @ 1:32 am

    I’m sitting here thinking that the Bernank needs to be kicked in the Jimmy.

  8. Pathfinder's wife
    March 2nd, 2012 @ 10:16 am

    But therein lies an error in your logic: yes news and entertainment are getting cheaper to procure, as are electronics and home appliances (very few of them are actual necessities).  
    Energy (either for transportation or utilities) and food are necessities though (and our society has gotten very divorced from reality when it fails to consider that those, and shelter/clothing are things that can become hard for some to come by) — and either the lower rungs of society get pinched (and then don’t buy the other things because their income is diverted towards food and gas — what happens to those industries then?) or somebody has to buy the necessary things for them in order for them to afford to buy the other stuff (which is a big problem).
    And as the prices go up the pinch and the groups falling into the “pay for it” category grow.

  9. Pathfinder's wife
    March 2nd, 2012 @ 10:20 am

    So, what I meant to say is that yes: you are correct, the cost of living is the important tell.

    But we’ve already passed that event horizon to a large degree.  The future is already here (many who are still reasonably well off don’t realize it yet; there’s the danger) we already have many people in this country (who are still holding on to whatever jobs they can find) who even with work could not afford the necessities without some form of aid.
    The cost of living is killing the tax base, but it’s killing them as well.  And all this needs is the proper conditions and a match…

  10. Bernanke: Let The Eat Stocks! (Apres Moi, Deluge Edition) | Daily Pundit
    March 2nd, 2012 @ 10:30 am

    […] The Eat Stocks! (Apres Moi, Deluge Edition) Posted on March 2, 2012 7:30 am by Bill Quick Paul And McCotter Grill Bernanke On Inflation, Which Is Unexpectedly Higher Than Bernanke Will Admit… A paraphrase: Bernanke points out that people could have put their money in the stock […]

  11. CPAguy
    March 2nd, 2012 @ 3:18 pm

    Necessities, such as food, are much cheaper than they were 30 years ago. The price might go up, but the share of income that the average family has to devote to it is more than half of what it once was. This is primarily due to the corn economy that was introduced 35 years or so ago and is why people are so fat these days.

    The big problem is that the US has borrowed so much money that it will be extremely difficult to either refinance that debt or issue new debt….which would be catastrophic.

  12. A few random quotes… « The TrogloPundit
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