a vicious, sinister tax on the poor and middle class

End The Fed;Save the Dollar

By Brian Beers

Nothing good can come from the Federal Reserve," writes Texas Congressman Ron Paul in his latest book hitting shelves this week, titled "End the Fed."

"It is the biggest taxer of them all. Diluting the value of the dollar by increasing its supply is a vicious, sinister tax on the poor and middle class."

Paul makes the case that the Fed is the main culprit responsible for the current economic mess the country faces through the destructive policies of cheap credit and excessive money printing.

"Prosperity can never be achieved by cheap credit," says Paul. "If that were so, no one would have to work for a living. Inflated prices only deceive one into believing that real wealth has been created."

The Federal Reserve, created in 1913, has been acting as the main central bank of the United States for nearly one hundred years. Many Americans are either not sure or not interested in what role the Fed plays in managing the economy. "The economic crisis has changed everything," writes Congressman Paul.

Paul is currently pushing for passage of a bill, H.R. 1207, that would allow for an unprecedented audit of the Federal Reserve. The bill has 289 co-sponsors, and is gaining solid momentum in the House of Representatives.

The worse the economy gets, the more power Congress is willing to grant to the Federal Reserve. Trillions of dollars created and distributed by the Fed with no requirement to submit to any oversight" argues Congressman Paul.

"End the Fed" is a sharp counter to Keynesian economic theory, and takes aim at the hazards of a managed economy.

Paul, a strong advocate of free-markets and the Austrian school of economics counters those looking to blame the near collapse of the financial system on capitalism by penning, "Manipulating the money supply and interest rates rejects all the principles of the free market, and so it cannot be said that too free a market caused this mess. The market was not free at all. It was manipulated and distorted."

But, wait.

Didn't Fed Chairman Bernanke hint that the recession may already be over?

Wouldn't that indicate that the "emergency interventions" of the past year or so worked to stabilize the economy, and all is on its way back to normal?

Paul writes, "The Fed is using all its power to drive the monetary base to unprecedented heights, creating trillions in new money out of thin air. From April 2008 to April 2009, the adjusted monetary base shot up from $856 billion to an unbelievable $1.749 trillion. Was there any new wealth created? New production? No, this was the Ben Bernanke printing press at work. If you and I did anything similar, we would be called counterfeiters and be sent away for a lifetime in prison. But, when the Fed does it - complete with a scientific gloss - it is seen as the perfectly legal and responsible conduct of monetary policy."

On the inflation front, Paul adds "It's as if we still believe that money can be grown on trees, and we don't stop to realize that if it did grow on trees, it would take on the value of leaves in the fall, to be either mulched or bagged and put in a landfill. That is to say, it would be worthless."

You get the feeling after reading this book, that Paul sees his goal of cutting off the power of the Fed as attainable in the long run, but needed a "playbook" to help educate the general public as to why they should care, and what they should demand be done about it from their elected officials.

The passage from the book that stuck with me the most. "When we unplug the Fed, the dollar will stop its long depreciating trend, international currency values will stop fluctuating wildly, banking will no longer be a dice game, and financial power will cease to gravitate toward a small circle of government-connected insiders."

Ron Paul's case for sound money policies and the end of "Fed domination" marches on, this time in hardcover.

http://www.cnbc.com/id/32881898/

Which Bank Could Implode Next?

http://www.thedailybeast.com/blogs-and-stories/2009-09-21/which-bank-will-implode-next/?cid=hp:mainpromo5
The G-20 leaders will meet in Pittsburgh Thursday to discuss slashing banker bonuses, but they’re focusing on the wrong threat.

The G-20 leaders will descend on Pittsburgh Thursday for a two-day financial summit, just as they did in London this past April. Exactly nothing of note followed that meeting, and the assembled figureheads are already focused on the wrong thing for this one. E.U. leaders, including French President Nicolas Sarkozy and German Chancellor Angela Merkel, have been adamant about the global need to address bankers’ pay. Sarkozy even threatened to walk out of the meetings if no agreement is reached on the topic of compensation. (President Barack Obama has said that he hopes the banks will curb bonuses before being compelled to—as if that will happen.)

Nomi Prins argues that they should be more worried about which bank "too big to fail" will go under next.

LINK: http://www.thedailybeast.com/blogs-and-stories/2009-09-21/which-bank-will-implode-next/?cid=hp:mainpromo5

Risk-taking Is Back For Banks 1 Year After Crisis

http://www.huffingtonpost.com/2009/09/13/risktaking-is-back-for-ba_n_285069.html
A year after the financial system nearly collapsed, the nation's biggest banks are bigger and regaining their appetite for risk.

Goldman Sachs, JPMorgan Chase and others -- which have received tens of billions of dollars in federal aid -- are once more betting big on bonds, commodities and exotic financial products - like the mortgage schemes that crashed the economy less than a year ago.

That Wall Street is making money again in essentially the same ways that thrust the banking system into chaos last fall is reason for concern on several levels, financial analysts and government officials say.

Political Economy: Back From the Brink

http://www.cqpolitics.com/wmspage.cfm?parm1=5&docID=weeklyreport-000003201166
Really? Tell that to the more than 15 million people who are out of work.

Closing The Book On The Bush Legacy

http://politics.theatlantic.com/2009/09/closing_the_book_on_the_bush_legacy.php
The annual Census Bureau report on income, poverty and access to health care "closes the books on the economic record of George W. Bush. It's not a record many Republicans are likely to point to with pride."

"On every major measurement, the Census Bureau report shows that the country lost ground during Bush's two terms. While Bush was in office, the median household income declined, poverty increased, childhood poverty increased even more, and the number of Americans without health insurance spiked. By contrast, the country's condition improved on each of those measures during Bill Clinton's two terms, often substantially."

Obama To Push for Financial System Overhaul Next Week

http://www.cqpolitics.com/wmspage.cfm?parm1=5&docID=cqmidday-000003200826
Is this dude trying to do too much at one time or what?

Goldman CEO Says Pay Backlash Is 'Appropriate'

http://www.huffingtonpost.com/2009/09/09/goldman-sachs-ceo-blankfe_0_n_281081.html
Tell us something we didn't know...

Ebony Fashion Fair victim of economy

http://www.miamiherald.com/living/fashion/story/1221286.html
The annual Ebony Fashion Fair's fall season -- which some call a rite of passage for black women -- has been canceled for budget reasons.

Alan Reynolds: Bigger Governments Produce Worse Recessions - WSJ.com

http://online.wsj.com/article/SB10001424052970203863204574347000967657192.html?mod=rss_opinion_main
love this bit of logic

To believe Big Government explains why this extremely long recession was not even longer, we need to find some connection between the size of government and the depth and duration of recessions. There is no such connection in U.S. history, or in recent cyclical experience of other countries. On the contrary, recessions have become longer as the U.S. government (and the Fed) became larger, more expensive, and more involved in the economy. Foreign countries in which government spending accounts for about half of the economy have also suffered the deepest recessions lately, while economic recovery is well established in countries where government spending is a smaller share of GDP than in the U.S. In short, bigger government appears to produce only bigger and longer recessions.

let me dismiss one claim that i think simplifies the data with another claim that simplifies the data - all qualified with the word "appears to." Lemme try:

* The job market appears to be getting worse the longer Brett Favre keeps playing

* the decline in popularity of American Idol roughly parallels the increase in Windows operating systems

* the increase in carbon levels seems to show that global warming is caused by hip hop.

Purchasing power: An alternative Big Mac index | The Economist

http://www.economist.com/daily/chartgallery/displayStory.cfm?story_id=14288808

On this day in 1926: Gold "discovered" in Johannesburg, South Africa

Start:	Aug 22, '09
Location:	Johannesburg, South Africa

The first South African gold rush followed the first diamond strikes by only a few years. Mining started in earnest in 1887, and the new township of Johannesburg began to fill with settlers. The first results were astonishing, and by the end of the year it was clear that the Rand mines were fabulously rich. Many of the Kimberley diamond millionaires moved to new headquarters in Johannesburg, which quickly became the largest city in southern Africa, a position it still holds.

Gold has long been the basis for South Africa's relative prosperity. At least half a million South Africans, including dependents and suppliers, rely on the industry. From ancient times to 1989, the South African mines produced more than 40% of all the gold that had ever been mined. In 1970 South African gold production was 1000 tonnes, then more than 70% of the output of the non-Communist world. South Africa is still the world's largest producer, by far. It has the world's deepest mine, 3585 m below surface at the East Rand mine. The Freegold mine, owned by Anglo American, was until recently the world's most productive gold mine at 115 tonnes a year; and Driefontein Consolidated has produced more than any other gold mine, at 2292 tonnes.

On this day in 1991: President George H. W. Bush declares recession is near an end

Start:	Aug 16, '09
Location:	United States

Proof the more things change, the more they remain the same.