vechorik
02-29-2012, 12:52 PM
Ron Paul and Rep. McCotter Confront Bernanke on Inflation, Monetary Policy
http://www.theblaze.com/stories/ron-paul-and-rep-mccotter-confront-bernanke-on-inflation-monetary-policy/#comment-2953316
Stocks are taking a hit this afternoon because of remarks made by the Chairman of the Federal Reserve Ben Bernanke after he was pushed by Congressmen Ron Paul and Thaddeus McCotter to explain the Feds current monetary policy.
The Dow, which had been up by as many as 51 points, reversed course as Bernanke started speaking. It turned negative within the hour.
Bernanke said the job market is still “far from normal” and that more stimulus measures may be needed, according to a recent CNBC report.
“Gas prices will add to inflation,” Bernanke said, “while unemployment is falling faster than expected.”
However, that‘s not why some analysts think the markets have reacted poorly to Bernanke’s testimony. It’s not because the Fed may launch more stimulus measures but because it may not engage in more stimulus spending.
“People want the punch bowl to be there forever,” Joe Saluzzi, co-manager of trading at Themis Trading, told CNBC. “[This selloff’s] because of the lack of what [Bernanke] said.”
“People have had an excuse to buy for the last three months and that excuse has been free money…people are looking for more,” added Saluzzi.
Watch Rep.Thaddeus McCotter question Bernanke on how monetary policy has affected inflation, saving, the health of the economy, and the stock market:
http://www.youtube.com/watch?&v=n4-o90N-cng
The current market losses are broad, with nine of the 10 industry groups in the S&P 500 losing ground. Materials and energy stocks had the sharpest declines, while consumer products and financial companies were nearly flat.
The price of gold was virtually unchanged until 10 a.m., just as Bernanke started speaking, then fell more than $70 an ounce. It recovered some of its losses and was down about $50 an ounce at $1,738.
“In January, at one of your press conferences, you sort of poked a little bit of fun at people to downplay the ‘two percent’ inflation rate,” Rep. Ron Paul (R-TX) said.
“But if you say it’s two and I say it’s nine, let’s compromise for the sake of argument that it’s five percent. Then you said ‘it doesn’t hurt you unless you’re one of those people who stick their money in the mattress.’ But where are you going to put it?” Rep. Paul asked.
“Are you going to put it in a CD and not make any money at all? This doesn’t make any sense. It doesn’t encourage any savings and it just discourages people,” Rep. Paul added.
Watch Rep. Paul explain to Bernanke his take on the real inflation rate, price increases, and the differences between fiat currency and a gold/silver standard (via Business Insider):
http://www.youtube.com/watch?v=H4uL6CSiGrU
The Associated Press contributed to this report.
http://www.theblaze.com/stories/ron-paul-and-rep-mccotter-confront-bernanke-on-inflation-monetary-policy/#comment-2953316
Stocks are taking a hit this afternoon because of remarks made by the Chairman of the Federal Reserve Ben Bernanke after he was pushed by Congressmen Ron Paul and Thaddeus McCotter to explain the Feds current monetary policy.
The Dow, which had been up by as many as 51 points, reversed course as Bernanke started speaking. It turned negative within the hour.
Bernanke said the job market is still “far from normal” and that more stimulus measures may be needed, according to a recent CNBC report.
“Gas prices will add to inflation,” Bernanke said, “while unemployment is falling faster than expected.”
However, that‘s not why some analysts think the markets have reacted poorly to Bernanke’s testimony. It’s not because the Fed may launch more stimulus measures but because it may not engage in more stimulus spending.
“People want the punch bowl to be there forever,” Joe Saluzzi, co-manager of trading at Themis Trading, told CNBC. “[This selloff’s] because of the lack of what [Bernanke] said.”
“People have had an excuse to buy for the last three months and that excuse has been free money…people are looking for more,” added Saluzzi.
Watch Rep.Thaddeus McCotter question Bernanke on how monetary policy has affected inflation, saving, the health of the economy, and the stock market:
http://www.youtube.com/watch?&v=n4-o90N-cng
The current market losses are broad, with nine of the 10 industry groups in the S&P 500 losing ground. Materials and energy stocks had the sharpest declines, while consumer products and financial companies were nearly flat.
The price of gold was virtually unchanged until 10 a.m., just as Bernanke started speaking, then fell more than $70 an ounce. It recovered some of its losses and was down about $50 an ounce at $1,738.
“In January, at one of your press conferences, you sort of poked a little bit of fun at people to downplay the ‘two percent’ inflation rate,” Rep. Ron Paul (R-TX) said.
“But if you say it’s two and I say it’s nine, let’s compromise for the sake of argument that it’s five percent. Then you said ‘it doesn’t hurt you unless you’re one of those people who stick their money in the mattress.’ But where are you going to put it?” Rep. Paul asked.
“Are you going to put it in a CD and not make any money at all? This doesn’t make any sense. It doesn’t encourage any savings and it just discourages people,” Rep. Paul added.
Watch Rep. Paul explain to Bernanke his take on the real inflation rate, price increases, and the differences between fiat currency and a gold/silver standard (via Business Insider):
http://www.youtube.com/watch?v=H4uL6CSiGrU
The Associated Press contributed to this report.