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Deficit, Europe May Spark Fed Action

July 18, 2012 by  

Deficit, Europe May Spark Fed Action
Another round of Federal Reserve action may be on the horizon.

Federal Reserve Chairman Ben Bernanke testified before the Senate Banking Committee yesterday, saying that the economy is still floundering and hinting that another round of Federal Reserve action is on the horizon.

Much of Bernanke’s focus was placed on European economic markets and U.S. lawmakers’ inability to agree on a plan to reduce the budget deficit at home without drastically sharp cuts and tax hikes.

On Europe, Bernanke said: “The Federal Reserve remains in close communication with our European counterparts. Although the politics are complex, we believe that the European authorities have both strong incentives and sufficient resources to resolve the crisis.”

But he concluded that European developments that resulted in a disruption in global financial markets would inevitably pose significant challenges for the U.S. economy that the Fed is ready to combat.

At home, the Fed chairman said that “U.S. fiscal policies are on an unsustainable path” said lawmakers should put high priority on a “medium term” deficit-reduction plan.

“The most effective way that the Congress could help to support the economy right now would be to work to address the nation’s fiscal challenges in a way that takes into account both the need for long-run sustainability and the fragility of the recovery,” he said. “Doing so earlier rather than later would help reduce uncertainty and boost household and business confidence.”

Economic experts say that Bernanke’s testimony alludes to his willingness to enter another round of Fed economic manipulation; but expect it to occur months from now, as it is the Fed chairman’s only remaining option.

Sam Rolley

Staff writer Sam Rolley began a career in journalism working for a small town newspaper while seeking a B.A. in English. After learning about many of the biases present in most modern newsrooms, Rolley became determined to find a position in journalism that would allow him to combat the unsavory image that the news industry has gained. He is dedicated to seeking the truth and exposing the lies disseminated by the mainstream media at the behest of their corporate masters, special interest groups and information gatekeepers.

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  • Flashy

    And so we see the effects of the Far Right’s economic plans of austerity in the face of economic recession and blocking any meaningful efforts. We also hear about their proposed plans for the future should they regain power …you liked the result of 2001-2009? They promise to do everything possible to hand us more of the same !

  • RichE

    Capitalist, heal thyself!

  • Steve E

    This is where fiat money gets you. Make yourself fiat money poor and precious metals rich. See which one wins in the end.

    • GALT

      Did the “root” gives odds on that?

    • fastfood

      I wonder what things would be like if our currency were still on the gold standard.

      Oh! And incidentally, RichE, capitalists do heal them selves, and forty-three per-cent government motors as well, not too mention most of the country.

      • RichE

        The Gold Standard limits the M1 to how much gold you have. If I have $1 million in gold you can only print $1 million in currency. The reason for paper currency backed by gold is so the gold won’t be lost or worn down. Once gold is lost it is lost. It can’t be replaced. In order to prevent loss gold is taken from the citizens, put in a vault and paper money is circulated Paper money can be replaced. If I print more money than I have gold then I could print a whole bunch of money, exchange it for your money, demand your gold, and move your gold to my vault. To prevent this gold isn’t moved from vault to vault just moved within the vault and exchange rates are monitored closely.

        How long does it take for a Capitalist to heal? Do Capitalists have health care insurance? What’s involved in the Capitalist healing process? Do they use the ER? Are they self medicated?

  • Rafael

    It is certain that many intellectuals envy the higher income of prosperous businessmen and that these feelings drive them toward socialism. They believe that the authorities of a socialist commonwealth would pay them higher salaries than those that they earn under capitalism.
    Stop printing money out of thin air.

    • GALT

      Define prosperous? Define income? Define intelligent? Define unalienable? Define productive? Define capitalism?

      Do you consider yourself to be an intelligent productive capitalist?

      Where are the common law and equity courts?

      • RichE

        While you’re at it, “What’s the meaning of is?”

      • GALT

        Last time I checked it meant ” to be” or if you like “”……as in I IZ that I IZ……

        or I are that I are…….don’t try to play with me……RUN!!!!!!

        So, citizen….where are those ( common ) law and equity courts?

        Strange how one simple question makes things real quiet……….

  • GALT

    See Sam……duping the public is easy………

  • RichE

    Boy! This thread is on fire. Excuse me for changing the subject. Has anybody heard from Sherriff Joe? I Googled and come up with, “Zullo said investigators previously didn’t know the meaning of codes but they were explained by a 95-year-old former state worker who signed the president’s birth certificate.” It sounds like the posse found the person who forged Obama’s BC.

    • Flashy

      Other than his office is in a huge mess and that he’s trying to draw attention away from that by claiming “false evidence” against the President’s birth. I’d say ol Joe should be more concerned about the uninvestigated sex crimes his office is accused of slacking on as well as the many claims made against his office for roughing up and denying Rights to Hispanics ….

  • wdharris2

    They could start by cutting out some pork spending in the legal system by almost completely doing away with the ADAM WALSH ACT. The act creates more problems than it solves. It is mostly based on Miths not on facts. If you do all of the research on it you will see. This bill is costing tax payers Billions of dollars and none of it really works. Besides it is written to avenge John Walshes kids death in which was never found, so sadly to say we may never know what happened.

    • GALT

      I agree this whole concept of JUSTICE……..especially EQUAL JUSTICE, is really stupid….

      Who needs GOVERNMENT…….for ANYTHING!!!!!!!!

      I mean the citizens of it are REALLY, REALLY STUPID……..

      So why expect a government of the PEOPLE to be better than it’s citizens?

      • RichE

        le bon mob mentality?

      • GALT

        was that like a question in english?

        • RichE


          Yes, English. Responding to your statement, “I mean the citizens of it are REALLY, REALLY STUPID……..”
          Le Bon wrote about group mentality. How a crowd becomes a mob. How a crowd becomes dumber than the dumbest person in the crowd in order for the crowd to communicate.

  • ROGER, Irish-Canadian LIBERTARIAN

    The CLUE as to WHY the Fed will continue indebting the American people and WHAT they are hiding, is in this ARTICLE but you must read it in its entirety to understand :

    It should make you VERY ANGRY

    • GALT

      nah…..I’m not angry……..

  • Dan Mancuso

    Fractional Reserve Banking, Fiat Currency Issue. The biggest scam going. This is what causes inflation. This is why a loaf of bread costs $5.00. This is why a gallon of gas costs $5.00. They are not costing any more to produce – your dollar is devalued and doesn’t buy as much as it used to. Beware, hyperinflation is just around the corner – maybe a good investment these days would be a wheelbarrow factory – opps, I guess they are all over in China!


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