Economy
Related: About this forumNever been fan of Mr. Bernanke; but now that a 2016 Crash appears to be underway .. thoughts?
Yes, I know. This is about 1-1/2 years old, but to me it makes it all the more interesting, since it
predicts a crash in 2-16 AND with the apparent crash apparently being underway.
Opinion: Countdown to the stock-market Crash of 2016 is ticking louder
By Paul B. Farrell * May 17, 2015 * MarketWatch.com
Warning bells just keep getting louder and louder as the countdown to the Crash of 2016 keeps ticking. Wall Street’s in denial, but the Washington Post warns: “U.S. economic growth slows to 0.2 percent, grinding nearly to a halt.” USA Today hears “Bubble Talk” at the Vegas “Davos for Geeks.” Earlier the Wall Street Journal warned, “declining population could reduce global economic growth by 40%.” Then recently the “slow-growth Fed” was blamed.
Wrong, former Fed chief Ben Bernanke counterattacked: “I’m waiting for the Journal to argue for a well-structured program of public infrastructure development, which would support growth in the near term by creating jobs and in the longer term by making our economy more productive.” But for years the Fed “has been pretty much the only game in town as far as economic policy goes.” Today “we should be looking for a better balance between monetary and other growth-promoting policies, including fiscal policy.”
Fiscal policy? No, Ben, not a chance. The GOP controls economic policy. And they will never give “growth-promoting fiscal policy” victories to President Obama and Hillary Clinton before the presidential election of 2016. Never. In spite of Bernanke’s obviously rational solution to the core problems of the American economy, one that would help the American people, the GOP will never, ever agree to fiscal stimulus programs that give the Democrats bragging rights and make Obama and Clinton look good before the elections.
The GOP is hungry for power, very hungry. They lost the presidency twice to Obama. They want it back. And now their collective ego is convinced that with the $889 million backing from the Koch Empire they can beat Hillary and take absolute control of the American democracy: win the presidency, hold Congress, gain the power to issue executive orders and veto legislation, appoint more than 6,000 insiders including cabinet officers, regulatory heads, federal judges, ambassadors, staff bureaucrats, and more. Yes, the GOP knows all that power is on the line in 2016.
http://www.marketwatch.com/story/countdown-to-the-stock-market-crash-of-2016-is-ticking-louder-2015-05-08
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elleng
(130,895 posts)similarly they won't promote REAL, CONCRETE stimulus. We are truly SKUNKED!
99th_Monkey
(19,326 posts)like a so-called "Evil Spell" that's been cast over DC & the US collective consciousness, that Wall St.
"big boys" are in charge, and us 'little people' are just screwed and it's hopeless.
And THIS^ is the spell Bernie is breaking, day-by-day, steady hammering away at it, never giving
up, never changing his focus, while fine-tuning message, as needed.
elleng
(130,895 posts)and worse than the wall st big boys, do know something about growth etc, imo, it's the f*king repugs who play the NO NO NO 'tax' game, and KILL us.
Warpy
(111,255 posts)and it might turn into an overcorrection. That's fine with me because if it is, stocks will rebound and then the market will be healthier.
A crash will be the collapse of the derivatives casino and it will happen practically overnight and take everything with it. I sincerely hope I'm dead and forgotten by the time that happens.
Hestia
(3,818 posts)Germany probably will too, even though it is glaringly obvious how that thinking is bringing down global markets.
I think Xmas was a last gasp for a bit. Everyone wanted to show everyone a nice time after so long but on Monday after NE's, 60% of households stated they are reigning in spending and wanting a large cushion in savings "should anything happen".
mrdmk
(2,943 posts)Monetary policy is conducted by the Federal Reserve (the Fed). Besides the well known Prime Rate the Fed has a number of tools to contract and expand the national and by extension international economies. A couple of these tools are the Reserve Requirements for both banks and insurance companies, Open Market Operations concerning purchases and sales of U.S. Treasury and federal agency securities, and the famous Discount Rate. Now the Fed also has expanded the responsibility to regulate the Finance Industry. These and other tools are very powerful as seen in past.
link: https://en.wikipedia.org/wiki/Federal_Reserve_System#Monetary_policy
Another Monetary policy, the Money Supply is conducted by both the Federal Reserve and United States Department of the Treasury. Their responsibilities are different as well as over lap in certain areas, therefore the two entities work together in this policy.
link: https://en.wikipedia.org/wiki/Monetary_policy_of_the_United_States
Fiscal policy is controlled by Congress with the yea or nay of the President. These policies include the dreaded tax collection, subsidies to industry, trade, regulation of industry, Federal Employment and a host of other financial concerns. Although these policies are numerous, Fiscal policy as a whole has a minimal effect compared to Monetary policy.
From 2001 to 2008 both the Monetary and Fiscal policies were running full throttle. The Monetary policy aloud as much money in the system as possible. Fiscal policy cut taxes to the bone, raised subsidies, promoted dangerous trade with countries with no regulation in environmental or employment laws, lowered regulations to almost nonexistence, two wars, and every other financial trick in the book. The financial spigot was wide open and thus the economy over heated.
In 2008, President Obama inherited a real mess. How to fix the economy, well hire a lot of the people who broke it and tell them to fix it. Two years later, the Republicans took power in Congress and did their collective best to break the economy without looking like they were trying. That was very apparent to anybody who took a few Econ Classes. The real truth why the economy is doing as well as it has is, people rich, poor, and in between like to make money and spend it so the economy will run in cycles. Although I give kudos to President Obama for his work, he was not the only one making the economy work and yes I do believe it could have been better.
Former Fed chief Ben Bernanke is correct about the U.S. Economy and thus the world economy will crash, it is inevitable. Having read his books, Bernanke does know what he is talking about except that Monetary and Fiscal policies are not running at full throttle. Also, there is more regulation at this time even though congress is doing its best to cut spending. Another major difference is we do not have Alan "I made a mistake" Greenspan calling the shots, for that matter "Helicopter" Ben Bernanke. Another words, there is wiggle room to nudge the economy out of a contraction into an expansion.
link: http://www.amazon.com/Principles-Microeconomics-McGraw-Hill-Economics-Robert/dp/007731851X/ref=sr_1_3?s=books&ie=UTF8&qid=1452904622&sr=1-3
link: http://www.amazon.com/Principles-Macroeconomics-Robert-Frank/dp/0077318501/ref=sr_1_4?s=books&ie=UTF8&qid=1452904622&sr=1-4
Good luck and the best everyone...
Hestia
(3,818 posts)Call it “Peak Conservativism,” whatever. No amount of money from the Kochs, Big Oil, can stop the coming paradigm shift in the global collective conscience — from the “mutant capitalist” ideology of Ayn Rand, the pendulum is swinging to the Pope Francis’ “moral imperative,” echoing Naomi Klein’s call for a worldwide revolution against capitalism.
In fact, the power grab by conservatives is already backfiring. They’re running real scared of Pope Francis, worried about his historic papal encyclical on “The Moral Imperatives of Global Climate Change Action” to be released next month, with its talking points on the sin of climate-science denialism.
Why so threatening? Because Pope Francis will deliver this historic message to a global audience in several historic speeches this fall: to the United Nations General Assembly, to a joint session of the U.S. Congress and to the World Meeting on Families in Philadelphia. All translated, reprinted and broadcast for billions.
Unfortunately for the GOP, the fossil-fuel industry recently exposed their overwhelming fear of Pope Francis, even made themselves look like fools when the Koch-financed Heartland Institute went to Rome during the recent Papal Summit on Climate Change and taunted the pope for backing the United Nations “climate-communist science,” comparing the pope’s fight against global warming with the church’s charges of heresy against Galileo and, earlier, Friar Giordano Bruno who was burned at the stake.
Heartland even threatened Pope Francis with this strange accusation (coming from an avowed climate-science denier): Your “decision to enter into the realm of science” harms the church, adding this warning: “Do not do this again.” Bad move guys, don’t be misled by his charming smile, Francis really loves a good fight, he’s a former boxer. Looks like Heartland just lost a lot of points in this fight
golfguru
(4,987 posts)First, re:Bernanke....
He is the one who sowed the poison berry seeds with QE's and helicopter money drops and PPT. Poor Janet, she has to deal with the fully grown crop of poison berries. The proverbial getting caught holding the bag.
These FED people are straight from ivory tower academics, having never run a business in the real world main street economy. They keep pushing money into throats of banks, hoping it will trickle down to small business and retail customers. That is same as giving enema from the mouth. It usually does not work.
And now for the good news....
Market has only about 10% lower to go! Half the pain is behind us!
magical thyme
(14,881 posts)1. "his is about 1-1/2 years old" his (Bernanke's?) what is about 1 1/2 years old?
2. "Yes, a crash of 20%, worse than 2008 and 2000, with the Dow dropping below 10,000."
20% is a correction, not a crash.
But yeah, the only real solution is infrastructure investment. The only chance is peaceful revolution. And Farrell wrote all that back when they thought Bernie was a joke.
99th_Monkey
(19,326 posts)published one and a half years ago.
I fixed it on edit. Thanks for pointing that out & apologies for any confusion. 
magical thyme
(14,881 posts)that's 9 months ago, not 18 months. Is there another date I'm missing?
99th_Monkey
(19,326 posts)magical thyme
(14,881 posts)and a big election year is a perfect time for the stock market to drop just due to all the uncertainty, never mind the disintegrating real economy. 
mother earth
(6,002 posts)gain. It seems to me there are a lot of reasons why we can't compare today's crises to yesterday's Great Depression though everyone uses that as their compass, so let's remove the fear factor and look at this as an awakening to what truly is. Where else is there for us to go, when all that's been done has wrought nothing but damage to the environment and ourselves?
Everywhere we are realizing we are coming to a pivotal time where change on all fronts absolutely must take place. NOTHING is working, the financial system is only one area, every part of lives is interconnected, so change on all fronts is warranted.
As for Bernanke, he was swimming with sharks, who can speak openly and honestly when you know all about you are predators? His words strike a chord because he was right, as we did need and still need, to invest in our infrastructure, that would've gone further than the half measures for Main St., but Wall St. won that battle. All around us is kabuki theater, sit back, watch the show, but don't get sucked in, after all, it's theater, it needs to play out.
The great battle is this year's election and taking back our Congress.
My thoughts are that our next president, and I hope it's Sanders, will be welcomed in with another economic crisis,
as Obama was. I do feel business as usual is over. People are truly waking up to all of the corruption, rigging and manipulation of every facet of our lives. I do think we are finally reaching a majority, whereby people no longer buy into the lies we are fed via MSM.
It isn't just our economic system that is in crisis mode. The stock market is only one symptom of the realization that another era, different from the last, is resulting in birth pangs of the new, and a dying away of the old.
The biggest choice that lies before us, as individuals, is who do we trust to be at the helm at the beginning of an era where great reform will pave the way for our future. Status quo, centrism and predatory capitalism has brought us the perfect storm.
All around us are all the perfect reasons to embrace political and social change. My feeling is you don't begin to tackle reform by coming from a place of weakness, embrace and empower change for the better, even if it means we will witness the slow death of the old system. Take comfort, that we can at least, now empower something real, lasting and humane. Look at it as a new beginning.
Having said all of the above, so many voices have all been sounding the alarm, it's time for a political and social movement. It appears, once again, we will undertake just that, doing the right when it's the last and only option left. If the stock market ushers it in, so be it. No one seems to pay attention to much else, proving even more so how money is a control system, it's been controlling us, impeding growth.
My thoughts are don't use their words by calling it a "crash", words are important, don't buy into the doom and gloom, look at this with new eyes and know, we aren't facing this alone, we are facing this together. The world is not going to end, but it looks like the curtain is being lifted, and we can see the mighty and powerful Oz is just an old man (or old men). Let's tear the curtain down.
The GOP is the old man, they aren't winning, they are on self-destruct with an implosion they can no longer control. We see them as clowns hoping to win favor from their masters. The masters are old men too, who don't see they are dying. What a shock for them, as the doom & gloom they believe they are weaving into their master plan chokes them, good riddance to them and their ilk.
Let's embrace the wave of change, nothing comes easily, and we can't compare it to anything that's happened before, I honestly wonder if any "crash" will be involved at all, wherever this leads, after we dust ourselves off, we can be stronger and better for what we have learned.
I think our reaction to the latest fear porn is being tested.