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Amid the recent financial crisis, the United States made some progress towards solving its biggest economic problem of recent years: the lack of US savings. Regrettably, in the latest figures, the beginnings of economic recovery have brought backsliding, with the savings rate dropping back to 4.3% from 6%. Without more savings, as global liquidity declines, the United States will quickly become a capital-starved economy, losing investment to capital surplus countries where savings are plentiful. The difficult questions are: what caused the savings decline, and what can be done to reverse it? During the halcyon years of the 1950s and 1960s,...

The biggest decision of the economic recovery will be made in the next six months, and Barack Obama will have almost nothing to do with it. Forget the debate over TARP, and never mind the questions about a second stimulus. This decision is about when to pull out $1 trillion that’s propping up the U.S. banking system. And it will be Federal Reserve Chairman Ben Bernanke and his Fed colleagues who make the call

Bernanke Gone Berserk! Bank Reserves Explode! Fed Money Printing Gone Wild! Interest-Rates / Quantitative Easing Oct 19, 2009 - 08:18 AM By: Martin_D_Weiss Martin here with the most shocking new numbers I’ve seen in my lifetime. My conclusion: Fed Chairman Bernanke has dumped so much funny money into the U.S. banking system and has done so little to manage how that money is used, the fate of our entire economy has now been cast under a dark shadow of doubt. This is not conjecture or exaggeration. Nor are the underlying facts subject to debate. They are blatant, unambiguous, and fully...

Government regulators threatened to remove top Bank of America executives in December if they didn't acquire Merrill Lynch, but also agreed to provide taxpayer funds to compensate for Merrill's poor performance, according to company records obtained by The Washington Times. The documents -- e-mails between bank executives and their outside lawyers as well as board-meeting talking points prepared for then-Chief Executive Ken Lewis -- indicate that former Treasury Secretary Henry Mr. Paulson Jr. and Federal Reserve Board Chairman Ben S. Bernanke promised to give the bank taxpayer bailout funds to compensate them for Merrill's poor performance. Summaries written by the...

Famed short-seller David Einhorn is bullish on gold because he's bearish on Obama. Members of President Obama's prized economic team, including Treasury Secretary Tim Geithner, are "quintessential short-term decision makers," Einhorn said, explaining his sudden fondness for gold. Watching Geithner, Federal Reserve Chairman Ben Bernanke and White House economic advisor Larry Summers on television recently, "my instinct was to short the dollar," Einhorn joked at the Value Investing Congress, a star-studded investment conference held in Midtown. Instead, he decided to invest in gold, even though futures hit a record price of $1,072 an ounce last week.

{snip} Currently, dollars account for about 62 percent of the currency reserve at central banks -- the lowest on record, said the International Monetary Fund. Bernanke could go down in economic history as the man who killed the greenback on the operating table. After printing up trillions of new dollars and new bonds to stimulate the US economy, the Federal Reserve chief is now boxed into a corner battling two separate monsters that could devour the economy -- ravenous inflation on one hand, and a perilous recession on the other. "He's in a crisis worse than the meltdown ever was,"...

Dispute of Paulson, Bernanke testimony Court documents show that federal regulators were told about billions of dollars in bonuses awarded to Merrill Lynch executives during the company's takeover by Bank of America - contradicting statements to Congress by Federal Reserve Chairman Ben S. Bernanke and former Treasury Secretary Henry M. Paulson Jr. The Securities Exchange Commission (SEC), in a brief filed in ongoing litigation with Bank of America Corp., said the bank informed the Treasury Department and the Federal Reserve of the Merrill Lynch bonuses as early as Dec. 17 - weeks before the government approved a $20 billion bailout...

One of the larger mistakes in the Obama financial regulatory reform package was its attempt to give the Federal Reserve additional powers so that it could in theory protect the economy from risks such as the housing bubble that could endanger the entire financial system. As we have argued in the past, the entire concept of minimizing systemic risk is a thankless task that is probably impossible. A key question is how much power such a regulator would have. As we said in June, “Congress could grant it such wide powers that the agency could intervene in just about any...

Federal Reserve Chairman Ben Bernanke has declared that the recession is over. Addison Wiggin, executive publisher of Agora Financial, isn’t buying it. In an interview with Dan Mangru of Newsmax TV, Wiggin said that the recent economic data, such as GDP and retail sales, don’t tell the whole picture. “It’s fictitious growth. It’s government stimulus making its way through the economy. But we don’t see any real recovery at the moment.” Watch the Exclusive Interview with Newsmax TV's Dan Mangru — Click Here Now! Although the administration has spent more than $19 trillion dollars on bailouts, Wiggin still says that...

Just because Ben Bernanke says the recession is over doesn't make it so. The chairman of the Federal Reserve may be technically correct that the economy is in recovery, but the average American is not impressed by slight upticks in the indicators. The disconnect is enormous between Wall Street--where stock prices have improved and banks are prospering again and paying big bonuses--and Main Street, where unemployment levels frighten even those with jobs and discourage consumers from buying and going into further debt. The psychology on Main Street is far more important to the real economy than is that of Wall...

HANK Paulson has admitted that he kept in touch with "market participants" on Wall Street when he was Treasury secretary. But did the former head of Goldman Sachs use his government position to enrich his friends during one of the most tumultuous times in US financial history? Paulson's phone logs, which I obtained after a Freedom of Information Act request, show that the Treasury chief kept in frequent touch with a virtual Who's Who of Wall Street's power players. But a half-hour block of time could prove to be the most intriguing bit of non-information in his schedule. Let me...

This misunderstanding indicates that Bernanke is unlikely to recognize the problematic nature of stopping the deleveraging process that has seen TOTLL, total loans and leases by the commercial banks, fall from $7.2 trillion to $6.8 trillion in the three months from June through August. The third is point is the explanation for Bernanke's focus on the banks rather than the consumer or even the private and commercial mortgage holders. ...While those who understand that the problem is too much debt, not too little money, will rightly be skeptical of both Bernanke's historical diagnosis and current prescriptions, this does explain some...

INTERNATIONAL. Legendary global investor and chairman of Singapore- based Rogers Holdings, Jim Rogers said the Fed and the US Treasury should have let 10 banks fail, not just Lehman Brothers, for the financial system to clean itself up. Speaking to CNBC Wordwide Exchange today Rogers said "All the government officials and bureaucrats loved the fact Lehman failed, because they could all jump in and support banks." "This whole problem was not caused by Lehman Brothers or Lehman Brothers failure. Lehman was an effect not a cause." "The real problem over the past 10-15 years has been that regulators have not...

The economic downturn will likely cost as many as 25 million people their jobs by end-2010 as the unemployment rate nears a record 10 percent in the OECD group of countries, according to a report released on Wednesday. The Organization for Economic Co-operation and Development said 15 million jobs were lost between end-2007 and July 2009 and 10 million more could go by the end of next year despite signs that the economy is picking up. "A major risk is that much of this large hike in unemployment becomes structural in nature," the report said.

New York, NY (AHN) - Federal Reserve Chairman Ben Bernanke's remark that recession is likely over a jump in August retail sales sent Wall Street to its highest close this year on Tuesday. The Dow Jones Industrial Average, beefed up by 56.61 points or 0.5 percent and gains by Alcoa, Caterpillar and General Electric, closed at 9,683 points. It was the eighth consecutive rise and highest close of the Dow since Oct. 2, 2008, according to reports. The Nasdaq Composite Index went up 10.86 points or 0.5 percent to end at 2,102.64 while the Standard & Poor's 500 Index climbed...

Here's another cartoon that Chris sent me this evening. Hope y'all enjoy. Earlier this morning I posted another cartoon he drew. Link

Well, its over,we got the word today Federal Reserve Chairman Ben Bernanke announce it, the Recession is "very likely over at this point." Great News Right? Well maybe not. Before you take out the champagne and invite your friends over for a party understand that there is much more to the story. Bernanke went on to say that we will have an under-performing economy well into next year "From a technical perspective the recession is very likely over," Bernanke said, cautioning that unemployment is likely to remain high. "It's still going to feel like a very weak economy for some...

Economists seem to be using new math to guage the start and end of this recession. When I learned economics in high school, I was taught that a recession was any period in which there were two quarters of negative growth in gross domestic product. That's why I had trouble understanding why economists everywhere began, at the end of 2008, to say that this current recession began at the end of 2007. At the end of 2007, the economy was still growing. Now, the roots of the recession certainly started there but the technical definition is nothing like what these...

Federal Reserve Chairman Ben Bernanke says the worst recession since the 1930s is probably over.

WASHINGTON – Halting the financial sector's death plunge is arguably the government's most measurable achievement this year. Yet as President Barack Obama observes the one-year anniversary of Lehman Brothers' collapse, his administration's increasingly sunny assessment of Wall Street's rebound faces a hard sell. The rescue effort, initiated by his predecessor, was expensive, and it bailed out the very institutions that the public blames for the crisis. Small banks are still failing, the institutions once considered too big to fail are putting on weight once again, and Obama's main pledge — a more watchful eye on Wall Street — hasn't taken...

Dear Esteemed Chairman and Savior of the World Economy: On behalf of your many Chinese friends and all of the Chinese people, we wish to congratulate you on your recent reappointment as Chairman of the American Federal Reserve. We could not be more pleased to know that the man who saved the value of our Fannie Mae mortgage-backed securities last year will be the Great Monetary Helmsman for another four years. We also note with satisfaction, and admiration, your many recent assurances, via the Wall Street Journal and various eloquent speeches, that you and the Fed have no intention of...

China has issued what amounts to the “Beijing Put” on gold. You can make a lot of money, but you really can’t lose. I happened to see quite a bit of Cheng Siwei at the Ambrosetti Workshop, a gathering of politicians and global strategists at Lake Como, including a dinner at Villa d’Este last night at which he listened very attentively as a number of American guests tore President Obama’s economic and health policy to shreds. Mr Cheng was until recently Vice-Chairman of the Communist Party’s Standing Committee, and is now a sort of economic ambassador for China around the...

It has been an interesting week indeed for the Federal Reserve. Early this week, it was announced that President Obama intends to reappoint Fed Chairman Ben Bernanke to a second term in January, signaling a vote of confidence in him. Bernanke seems to be popular with the administration and with Wall Street, and with good reason. His lending policies have left big banks flush with newly created cash that covers up old mistakes and allows for new ones. By buying up mountains of Treasury debt he has also enabled spending to soar to ridiculous levels that should startle any responsible...

That's the view from this particular blog. The free market understands that auditing the fed is a very dangerous line to cross. If crossed, U.S. inflation will likely skyrocket over the next decade to unseen levels. U.S. economy tanks. Bond investors lose money as interest rates rise. Stock investors earn negative real return as equity risk premium rises and aggregate PE ratio tank. The US Dollar erodes due to higher domestic inflation relative to foreign inflation. Gold and commodity prices rise.

If you've been to any tea party, then you've probably seen someone that supports H.R. 1207. That's a bill sponsored by Ron Paul that would mandate a full and complete audit. Now, if you're unfamiliar with the matter, you might be shocked. You'd probably assume that the finances and balance sheets of our own Central Bank would already be a matter of public record. Not so. The public doesn't know exactly what the central bank owes and owns. That appears to be coming to an end. H.R. 1207 is favored overwhelmingly. More than that, it gets support from a cross...

“Paper money eventually returns to its intrinsic value -- zero.” -- Voltaire “The Federal Reserve in collaboration with the giant banks has created the greatest financial crisis the world has ever seen. The foolish notion that unlimited amounts of money and credit created out of thin air can provide sustainable economic growth has delivered this crisis to us. Instead of economic growth and stable prices, (The Fed) has given us a system of government and finance that now threatens the world financial and political institutions. Pursuing the same policy of excessive spending, debt expansion and monetary inflation can only compound the...

Ayn Rand wrote, "when you see corruption being rewarded and honesty becoming a self-sacrifice - you may know that your society is doomed." America is not doomed, but the fellows in Washington are pushing for that outcome. It seems that all the characters that encouraged this financial crisis are being rewarded, and Ben Bernanke's re-nomination is no exception to this rule. He was on the Board of Governors when Alan Greenspan grew our bubble economy. Known as 'Helicopter Ben,' Bernanke was the most vocal supporter of low interest rates to combat the bogus threat of deflation, even if it meant...

House Financial Services Chairman Rep. Barney Frank, Massachusetts Democrat, said he expects former GOP presidential candidate Ron Paul's legislation to audit the Fed to pass out of his committee in October as part of a larger regulatory package.

Ben Bernanke won the nickname “Helicopter Ben” for describing quantitative easing as akin to dropping money from helicopters in 2002. He was quoting the US economist Milton Friedman, who had said it would be theoretically possible for governments to drop large amounts of cash out of helicopters for the public to pick up and spend... Born in Augusta, Georgia, Bernanke was raised in a ranch house on East Jefferson Street in Dillon, SC, and was educated at East Elementary, J. V. Martin Junior High, and Dillon High School, where he was class valedictorian. At age 11, Bernanke won the state...

Fed Chairman Ben Bernanke was ripped off by a sophisticated identity theft ring. The man most responsible for the nation's fiscal policy was one of hundreds of victims of an elaborate, $2.1 million scam headed by a convicted con man known as "Big Head," according to NEWSWEEK. The crime came just as Big Ben was dealing with the first rumblings of the financial crisis on Wall Street, after Bernanke learned that a thief had swiped his wife's purse at a Washington Starbucks. The Bernankes had been victims of a versatile ring that combined high tech swindling with old-fashioned thievery. Days...

George Mason University economics professor and occasional NYT contributor, Tyler Cowen, offers a commentary for NYT on what's ahead for Bernanke: I was glad to see Mr. Bernanke reappointed but he faces a daunting task.Basically the Fed pumped a lot of liquidity into the economy to sustain the banking system. So far all that new money has not caused inflation because banks have sat on much of it rather than lending it out and stimulating expenditures. His biggest challenge will come when the economy starts to recover and the new money starts to be translated into inflationary pressure on prices....

The Obama administration has two approaches to former Bush administration officials: Threaten them with prosecution (CIA interrogators, Justice Department lawyers) or reappoint them to office (the secretary of defense). Ben Bernanke, once known as “Helicopter Ben” but destined to go down in history as “Bailout Ben,” has been reappointed as chairman of the Federal Reserve, though there are critics, left and right, who might have dreamed in secret of the other approach. Bernanke’s reappointment invites a fresh assessment of his management of the recent financial crises, including the much-criticized bank bailouts, and the chairman comes off surprisingly well. The unprecedented...

Belief that the worst is behind is now nearly universal. Mickey Mouse, aka Ben Bernanke, even has himself fooled. He was reappointed today as grand wizard (see Bernanke's Self-Promotional Reappointment Campaign A Stunning Success) and in general people are feeling pretty good about it. Indeed Consumer sentiment improves more than expected. Consumer sentiment rose more than expected in August and expectations hit the highest level since the recession began, indications that Americans' pessimism about the economy may be lifting. The New York-based Conference Board said Tuesday its Consumer Confidence index rose to 54.1 from an upwardly revised 47.4 in July....

The troubling side of Ben Bernanke He has saved the world but he helped cause the crisis in the first place, writes Ambrose Evans-Pritchard. By Ambrose Evans-Pritchard Published: 8:29PM BST 25 Aug 2009 Comments 35 | Comment on this article Ben Bernanke has proved himself a heroic fire-fighter, saving world from a calamitous spiral into debt deflation by showering markets with liquidity. A good thing too. He helped cause the raging fire of 2007-2009 in the first place. As a Princeton professor and then a junior Federal Reserve governor, Mr Bernanke was the intellectual architect of his predecessor Alan Greenspan's...

Mr Bernanke made three critical mistakes in his pre-Lehman incarnation: First, and foremost, he was deeply wedded to the philosophical conviction that central banks should be agnostic when it comes to asset bubbles. On this count, he stood with his predecessor – serial bubble-blowing Alan Greenspan – who argued that monetary authorities are best positioned to clean up the mess after the bursting of asset bubbles rather than to pre-empt the damage. As a corollary to this approach, both Mr Bernanke and Mr Greenspan drew the wrong conclusions from post-bubble strategies earlier in this decade put in place after the...

<p>Yesterday President Obama confirmed what futures markets seemingly already knew, that Ben Bernanke would be reappointed as Fed Chairman. Whatever one's opinion of Bernanke, his successes and failures will now reflect on the man who chose to keep him in place at the Federal Reserve.</p>

This morning Ben Bernanke said two very curious statements. First there's this one. We have been bold or deliberate as circumstances demanded, but our objective remains constant: to restore a more stable financial and economic environment in which opportunity can again flourish and in which Americans’ hard work and creativity can receive their proper rewards.

OAK BLUFFS, Mass., Aug 24 (Reuters) - U.S. Senate Banking Committee Chairman Chris Dodd promised on Monday a 'thorough and comprehensive' hearing on the renomination of Federal Reserve Bank Chairman Ben Bernanke.

President Obama is turning a blind eye to Bernanke's all too many errors of judgment. An old boss of mine, who is well versed in the ways of Washington, once cynically explained to me that in Washington nothing succeeded so well as failure. President Obama's decision to reappoint Ben Bernanke for a second term as Federal Reserve chairman would suggest that my former boss continues to be right about the way Washington works. Despite Bernanke's many egregious errors of judgment during his first term, which have cost the nation so dearly, President Obama is choosing to give him a second...

Federal Reserve Bank chairman Ben Bernanke, who was reappointed to a second four-year term Tuesday, is a renowned expert on the Great Depression, driven to avoid a repeat of such devastation. Bernanke has earned plaudits for helping steer the US economy through one of its most perilous periods and toward recovery, with President Barack Obama repeatedly thanking him for his contribution. He was aided in his bid for a second term at the helm of the Fed by the strong working relationship he has forged with Democrat Obama's economic team -- despite being a holdover from George W. Bush's Republican...

Grassley, speaking about the renomination of Federal Reserve Chairman Ben Bernanke to a second term as head of the Fed, asserted that Bernanke's ability to hold down inflation would be the metric by which the Fed's success would be measured. "We won't know for a year if he's done a good job so far, because he shoveled money out of an airplane to save banks and the financial system," Grassley said in a conference call with Iowa reporters. "But shoveling money out of an airplane to solve problems can be inflationary — in this case, hyperinflationary — if he doesn't...

“The alarm bells on our nation’s fiscal condition have now become a siren” “If anyone had any doubts that this burden on future generations is unsustainable, they’re gone — spending, borrowing and debt are out of control.” Senate Minority Leader Mitch McConnell Today CBO issued its annual summer update of the budget and economic outlook. CBO estimates that the federal budget deficit for 2009 will total $1.6 trillion, which, at 11.2 percent of gross domestic product (GDP), will be the highest since World War II. That deficit figure results from a combination of weak revenues and elevated spending associated with...

<p>ARROYO GRANDE, Calif. (MarketWatch) -- At last week's annual Jackson Hole meeting of Fed execs, Boss Ben Bernanke's braggadocio about saving the world from another Great Depression had the feel of an egomaniacal dictator trying to cement his legacy in history.</p>

The president will nominate again Ben Bernanke to be Federal Reserve chair. It's a story that will get a little coverage and even less analysis. Most people will nod and move on their way. Just think about that for a minute. The Fed chairman controls the money supply in the country and by extension the world, and this story will get little mention and even less analysis. The Federal Reserve chairperson is arguably the most powerful person in the world and yet the dynamics by which they are nominated and nominated again receives less attention than a story on Brittney...

Reporting from Martha'S Vineyard, Mass., and Washington -- Federal Reserve Chairman Ben S. Bernanke, a scholar of the Great Depression who moved boldly last fall to prevent another economic catastrophe, will be nominated by President Obama to a second four-year term as head of the nation's increasingly powerful central bank, a senior administration official said Monday night.

NEW YORK, Aug 25 (Reuters) - U.S. stock index futures were slightly higher on Tuesday on news that Ben Bernanke will be renominated as chairman of the Federal Reserve and ahead of key consumer confidence and housing data. * U.S. President Barack Obama will renominate Ben Bernanke for a second term as chairman of the Fed on Tuesday, a senior administration official said. (For details, see [ID:nBERNANKE]) * The renomination is being viewed as a positive by U.S. markets, said Peter Cardillo, chief market economist at Avalon Partners in New York. * S&P 500 futures SPc1 rose 1.6 points and...

His supporters argue that Mr Bernanke's unprecedented policies have ensured history will remember the self-styled 'Great Depression buff' differently. Mr Bernanke, 55, Tim Geithner, the US Treasury Secretary, and Hank Paulson, Geithner's predecessor under the Bush administration, have spent the past 12 months tackling a financial and economic blaze that threatened to topple the world's financial system last autumn. The crisis, whose symptoms first surfaced in America's sub-prime mortgage system two years ago, has since driven the global economy into its first global recession since World War II. "I did spend a lot of my career studying the Great Depression...

This is in relation to a lawsuit filed by Bloomberg LP against the Federal Reserve on November 7, 2008, in Southern District of New York (08-09595), in which Bloomberg sought material loan and collateral data in relation to emergency loans released by the Fed, and which were previously claimed to be non-FOIAble. This is a large blow against the Fed and specifically against organizations using FOIA loopholes from providing critical information, particularly in cases involving trillions of taxpayer dollars bailing out huge, systematically and politically embedded financial organizations (which lately is pretty much all of them).

President Obama on Tuesday morning will nominate Federal Reserve Chairman Ben S. Bernanke to a second term as the head of the world's most powerful central bank, a White House aide said. The president will make a statement at 9 a.m. in Martha's Vineyard, where his family is on vacation, announcing his decision to keep Mr. Bernanke, whose term expires in January. A Republican who was chairman of President George W. Bush's Council of Economic Advisers, Mr. Bernanke was first appointed to the job by Mr. Bush in 2006. (snip) The move is perhaps the most significant display of bipartisanship...

The decision to retain Bernanke as Fed chief sends a message: The president doesn't think the crisis is over. President Barack Obama will announce Tuesday morning that he will appoint Federal Reserve Chairman Ben Bernanke to a second four-year term, according to an administration official. The announcement will end months of speculation over whether the administration would replace Bernanke when the Bush appointee's first term ends in January 2010. Although Bernanke's reappointment needs to be confirmed by the U.S. Senate--a virtual certainty--the news sends a positive signal to markets that someone who understands the financial crisis intimately will be in...