Ron Paul drilling Bernanke a new one..

...at the House Financial Services Commitee meeting today. The more I hear this guy the more impressed I am.

Bernie responded with the usual "we're always concerned about inflation blah blah"... Not convincing at all.

Too bad Paul hasn't got a shot in hell to win.

 

http://journalofinterest.wordpress.com/2007/08/22/the-feds-real-reaction-function/

James K. Galbraith: The Fed’s Real Reaction Function

the Federal Reserve does not target inflation but "too low" unemployment

____________

Galbraith’s take on the Fed:

Using a VAR model of the American economy from 1984 to 2003, we find that, contrary to official claims, the Federal Reserve does not target inflation or react to “inflation signals.” Rather, the Fed reacts to the very “real” signal sent by unemployment, in a way that suggests that a baseless fear of full employment is a principal force behind monetary policy. Tests of variations in the workings of a Taylor Rule, using dummy variable regressions, on data going back to 1969 suggest that after 1983 the Federal Reserve largely ceased reacting to inflation or high unemployment, but continued to react when unemployment fell “too low.” Further, we find that monetary policy (measured by the yield curve) has significant causal impact on pay inequality—a domain where the Fed refuses responsibility. Finally, we test whether Federal Reserve policy has exhibited a pattern of partisan bias in presidential election years, with results that suggest the presence of such bias, after controlling for the effects of inflation and unemployment.

And the bias is:

Specifically, we find that in the year before presidential elections, the term structure deviates sharply from otherwise-normal values. When a Republican administration is in office, the term structure in the preelection year tends to be steeper, by values estimated at up to 150 basis points, and monetary policy is accordingly more permissive. When a Democratic administration is in office, the term structure tends to be flatter, by values

 

What are the odds that even one other presidential candidate has any idea what he's talking about?

http://www.youtube.com/watch?v=138LMjiBQ4g

 

I'm quite confident that Romney is familiar with these topics. The man has a joint JD-MBA from Harvard and ran Bain Capital.

 

Ah yes, good point.

 

but does he care

 

It's that mentality that keeps echoing in peoples heads that he can't win. Your vote isn't a bet or gamble on who you think will win. It's voting for who you want to be in office. A wasted vote is only one in which you don't believe in what you voted for.

 

Ron Paul doesn't have a chance because of the success of propaganda. He is the jarring dissonance.

The truth usually is....

 

I'm not impressed with how Ron Paul let him go though... He didn't further inquire (ie HOW we will get a control over inflation). Just another politician selling himself - not someone who has balls to ruffle feathers.

 

If he ruffles too many feathers he will die.