Dean Baker — prominent Keynesian pundit and codirector of the Center for Economic and Policy Research — testified that the dollar's fall was inevitable, and even a good thing in light of the US trade deficit. At the time, I knew I disagreed with Baker, but I didn't get a chance to explain why.
As interviewed by Mark Carbonaro, 1460 KION, Salinas, California; 29 April 2011.
Once Fed policy makers freeze the balance sheet of the US central bank, the growth momentum of the money supply will slow down.
The deficit-hawk politicians are right when they say the government should be sharing in the belt-tightening along with everyone else. Slashing spending at the federal level would return much-needed resources to the private sector, where they would do the most good.
Bernanke has opened the Fed's checkbook in an unprecedented fashion. He claims to be "saving" the financial system. In reality he is destroying it.
The Fed economists and their supporters really believe — truly believe — that they are the rescuers of our economy.
Why should we care about his predictions concerning the economy or his recommendations for how to end the slump? The answer, of course, is that the Federal Reserve has the power to destroy the world economy.
