I am completely against further Easing/QE2.And The rationale behind it is also very clearly explained in the above post.
The only thing I want to add to that is this.
The Ruling elite know how badly they have messed things up so far in America and will do whatever it takes to divert attention from the core Issue here-Generating Jobs.
Like attacking Iran.The reason they will say is because Iran has nuclear ambitions;but the Real Reason is that Iran no longer wants to Hold US dollars as Reserves.They are moving to Gold and are looking to convince the rest of OPEC to follow suit.With no need for the US Dollar in transactions the need to hold US Dollars falls and falls dramatically;leading to a consequent Loss of the Value of the US Dollar
[At a time when Supply of US Dollars is increasing dramatically,courtesy QE2 the Demand will fall precipitously end Result-Collapse of the Value of the US Dollar]
A lot of middle-class Americans like you think in this way.
I think financial regulators in the United States know exactly what they are doing. They may also be getting tired of holding up consumption for the rest of the world and this may be behind the conscious efforts to weaken the value of the dollar.
You are right they are running out of ammunition-This sentence is the only place where I agree with you entirely,
I hope for the sake of all Americans it works out as they claim it will(That devaluing the US Dollar will boost the US economy).
Unfortunately looking at their past track record(How many times have they said the Sub-prime mess will be contained or Banks are fine or whatever else nonsense,when a few months later everything exploded again???)
The truth of the matter is these guys(The white house/US Federal Reserve/ Congress) have no clue and are doing whatever Wall Street wants them to do regardless of whatever the consequences are for mainstream America.
Its the truth.As for the fact that these clowns keep talking about that there is no inflation.I can only laugh.
For an idea of the real impact that the US Federal Reserve's Money printing policies are having on America(forget about rest of the world),click on these links and read them.Inflation statistics that these clowns parrot every single day are manipulated and do not include the costs that Working Americans are paying on a day to day basis(In Food,Groceries and Gasoline).Which are all going in only one direction-UP.
Sure if somebody is a free loader on Welfare/Foodstamps/unemployment insurance/living in a foreclosed house for free(because the lender is unable to foreclose on you because of the recent ban) then all this really does'nt matter but what about those who work hard,pay all their Taxes on time,pay their mortgages on time and Save money every year for retirement?
These policies by the US Federal Reserve are designed to destroy them.And I wish those hard working Americans stand up and challenge these clowns decisively soon.Otherwise,once this process of devaluation of the dollar which has started now continues it will end up comprehensively Destroying the American Standard of Living.And once that destruction happens this whole welfare nonsense in America will come to a complete stop.Leading to anarchy on an unimaginable scale.
Most Americans also don't realize that owning the World Reserve currency is a privilige which needs to taken care of well.If this constant debasing of the US Dollar(& the Pound,& the Yen & the Euro ) does'nt stop then the real savers will stop using all these paper currencies and move to Gold and Silver.The Chinese have already been moving decisively to stop using the US Dollar for a significant proportion of their trade (with some of their major trading partners-Brazil,Russia, Turkey, HongKong and many other countries in South America & East Asia).These trades are no longer settled in US Dollars(they are settled in their respective currencies).All it now needs is for the OPEC exporters to price Oil in a basket of currencies and the need to Hold US Dollars for the rest of the world drops and drops dramatically.What happens then to all these excess Dollars that the US Federal Reserve is happily creating today and will continue to create through QE2?
It will end up devaluing all existing US Dollars in circulation beyond all imagination.
End result-Won't be moderate inflation (of 2-3% per year) these clowns talk about.Its going to Hyperinflation like what we saw in Zimbabwe or Weimar Germany.
That is what Gold and Silver are both telling the world this year.
Which is why,I Keep saying again and again.America's economy has a lot of structural problems which cannot be solved by Devaluing the US Dollar alone. For that The White House and Congress have got to show courage and act Now,before it is too late.
Unless they have already given up and resigned to the fate of a rapidly declining standard of Living for All Americans.
Ashish, What you see as the Fed's actions that would destroy the dollar the U.S. probably considers a necessary step to invigorate exports, cut imports and boost employment at home. I think financial regulators in the United States know exactly what they are doing. You are right they are running out of ammunition. They may also be getting tired of holding up consumption for the rest of the world and this may be behind the conscious efforts to weaken the value of the dollar.
The Fed would have to print more money to stimulate the economy, which could result in higher inflation. I believe they are not worrying about this, though. With unemployment still high and consumers reluctant to buy, inflation may not be a concern. The Fed can pour money into the economy but stronger business hiring and higher demand for products are what will eventually lead to growth not just fiscal stimulation.
We need to make structural changes in the US economy for which Congress and the Obama administration have to act.The US Federal Reserve is powerless at this point and continuing on its current strategy will only end up destroying the value of the US Dollar.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.