Sunday, May 01, 2011

"BEN LAYS AN EGG"   If you subscribe to Barrons online this is a must read, if you do not this will be in public domain in about a for it a read.

Beginning in 1998 when we had the Long Term Capital fiasco, the FED pumped the market with liquidity and that created the 1998-2000 Tech Bubble...we know how that ended. Now that was a MILD Recession as far as they go, but NO PAIN should be shared when FED action and speculation go we had even a heavier hand by the FED in 2001-2003 with 1% rates and the EASY MONEY flowed into Real Estate, and we also know what happened because of that.

WILD SPECULATION in housing and upward SPIKES in prices wnet completely unchecked, and even the FED when asked about housing "SAW NO PROBLEMS, NO RISKS"....see my Bernanke video.

OK, now we also know what has happened since the most recent FED action, I'll see you one better lowering of funds rate to 0%, and taking their own balance sheet from $800B to over $2.5 T...this year alone pumping $600B into the treasury market and beyond...

Randall Forsyth concludes "....and memories are too short to recall that liquidity-driven speculative frenzies tend to end badly."

With only 54%, the lowest on record owning stocks, we can summise who is doing OK with a $4T increase in equity prices since's not you or me.

What you and me got is lower real wages, much higher prices ad near 0% returns on our savings, seeing our standard of living downgraded.

SO WHAT we had a Bernanke press conference, NO ONE will bother to ask the tough pertinent questions, and we will continue to getthe same policies which are harming the avg American...."for an extended period of time."

Just a FEW people have the power to redistribute wealth and it isnt going in the direction of the Middle Class.

In Maryland the funds for roads has been transferred to the general accounts to help balance the States shortfalls. There is now talk of RAISING GAS TAXES to help put money back for road repair etc....


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