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alstry (36.06)

Economics is a Fraud......Getting Really Close Now

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November 20, 2009 – Comments (4)

The Federal Reserve, through its extensive network of consultants, visiting scholars, alumni and staff economists, so thoroughly dominates the field of economics that real criticism of the central bank has become a career liability for members of the profession, an investigation by the Huffington Post has found.

This dominance helps explain how, even after the Fed failed to foresee the greatest economic collapse since the Great Depression, the central bank has largely escaped criticism from academic economists. In the Fed's thrall, the economists missed it, too.

"The Fed has a lock on the economics world," says Joshua Rosner, a Wall Street analyst who correctly called the meltdown. "There is no room for other views, which I guess is why economists got it so wrong."

One critical way the Fed exerts control on academic economists is through its relationships with the field's gatekeepers. For instance, at the Journal of Monetary Economics, a must-publish venue for rising economists, more than half of the editorial board members are currently on the Fed payroll -- and the rest have been in the past.

The Fed failed to see the housing bubble as it happened, insisting that the rise in housing prices was normal. In 2004, after "flipping" had become a term cops and janitors were using to describe the way to get rich in real estate, then-Federal Reserve Chairman Alan Greenspan said that "a national severe price distortion [is] most unlikely." A year later, current Chairman Ben Bernanke said that the boom "largely reflect strong economic fundamentals."

The Fed also failed to sufficiently regulate major financial institutions, with Greenspan -- and the dominant economists -- believing that the banks would regulate themselves in their own self-interest.

Despite all this, Bernanke has been nominated for a second term by President Obama.

In the field of economics, the chairman remains a much-heralded figure, lauded for reaction to a crisis generated, in the first place, by the Fed itself. Congress is even considering legislation to greatly expand the powers of the Fed to systemically regulate the financial industry.

http://www.huffingtonpost.com/2009/09/07/priceless-how-the-federal_n_278805.html

Whether the Fed induces a war before the ship breaks apart is yet to be seen.....one thing for sure, the ship is breaking apart as the lies are having trouble masking the reality.

4 Comments – Post Your Own

#1) On November 20, 2009 at 9:08 AM, alstry (36.06) wrote:

How the Fed can say the recession is over when an unprecedented number of cities, counties, and states are facing massive financial crisis due to  evaporating tax receipts is beyond reason.

It is also a cruel joke to represent to the population that unemployment is around 10% when the real rate is well over 20% factoring the decline in the labor participation rate.

No nation in history can claim its economic decline is improving when it is borrowing $2 Trillion per year to remain on life support.

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#2) On November 20, 2009 at 9:23 AM, alstry (36.06) wrote:

San Francisco's lowered home values and high unemployment rates have created another unwelcome side effect: far less revenue coming into city coffers than expected.

A report released Monday by the controller's office shows that property tax revenues will likely be $35 million less than anticipated in the 2009-10 fiscal year that began July 1. Payroll tax revenues will probably be $24.8 million less than expected, the report said.

To make matters worse, some city departments are going over budget, including shortfalls of $5.1 million in the Fire Department, $4 million in the Sheriff's Department and $3.2 million in Superior Court.

"I don't even know if I have words to describe how bad this is," said Steve Kawa, Mayor Gavin Newsom's chief of staff. "It may be the perfect financial storm," Kawa said. "It's going to be incredibly difficult to find a way to balance next year's budget without some severe impacts."

http://globaleconomicanalysis.blogspot.com/

Welcome to the perfect storm.....zombulation.

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#3) On November 26, 2009 at 3:11 AM, awallejr (79.46) wrote:

" . . . generated, in the first place, by the Fed itself."

I blame Congress and Bill Clinton for their changing Glass-Steagall Act.  Greenspan too for aiding fuel to the fire with lower interest rates.  Ironically it was Bernanke who ultimately pricked the bubble with his series of interest rate hikes. 

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#4) On November 26, 2009 at 3:12 AM, awallejr (79.46) wrote:

aiding=adding.

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