Posted on 10/06/2010 8:55:50 AM PDT by george76
Ultra-loose monetary policies by the Federal Reserve and the European Central Bank are throwing the world into "chaos" rather than helping the global economic recovery, Nobel Prize-winning economist Joseph Stiglitz said on Tuesday.
A "flood of liquidity" from the Fed and the ECB is bringing instability to foreign-exchange markets, forcing countries such as Japan and Brazil to defend its exporters...
"The irony is that the Fed is creating all this liquidity with the hope that it will revive the American economy," Stiglitz said. "It's doing nothing for the American economy, but it's causing chaos over the rest of the world. It's a very strange policy that they are pursuing."
The U.S. dollar has weakened about 6.5 percent against a basket of major currencies since the beginning of September as prospects for further monetary easing by the Fed have led investors to seek higher returns elsewhere.
(Excerpt) Read more at reuters.com ...
As the International Reserve Currency, our main export now is Inflation. See China, Real Estate and Labor Strikes.
Personally, I don't think it will take near as long as the NIA predicts. I'm thinking more like within the next 1-5 years.
We bitch about the low Chinese currency rate but Euro has been quite high lately, and EU still has a positive trade balance.
Maybe, just maybe we should produce something and try to sell, instead of ruining the dollar
Nah, we are the New Socialist State where no one works and we print currency to distribute to the masses.
My Letter to the Editor of the WSJ today (not published, just sent):
When the (Page A1, 10/6) headline reads “Central Banks Open Spigot,” someone needs to inform Mr. Bernanke et al that Monetary Policy can’t cure a recession that lengthens due to the destructive power of increasing taxes, government spending and bureaucracy.
It could be a calculated plan to throw the worlds other economies into chaos and cause a rush of investment into the somewhat stable United States. Or we just have a pack of idiots at the helm who are just winging it.
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