What is the most likely cause today of civil unrest? Immigration. Gay Marriage. Abortion. The Results of Election Day. The Mosque at Ground Zero. Nope.
Try the Federal Reserve. November 3rd is when the Federal Reserve's next policy committee meeting ends, and if you thought this was just another boring money meeting you would be wrong. It could be the most important meeting in Fed history, maybe. The US central bank is expected to announce its next move to boost the faltering economic recovery. To say there has been considerable debate and anxiety among Fed watchers about what the central bank should do would be an understatement. Chairman Ben Bernanke has indicated in recent speeches that the central bank plans to try to drive down already low-interest rates by buying up long-term bonds. A number of people both inside the Fed and out believe this is the wrong move. But one website seems to believe that Ben's plan might actually lead to armed conflict. Last week, the blog, Zerohedge wrote, paraphrasing a top economic forecaster David Rosenberg, that it believed the Fed's plan is not only moronic, but "positions US society one step closer to civil war if not worse." (See photos inside the world of Ben Bernanke)
I'm not sure what "if not worse," is supposed to mean. But, with the Tea Party gaining followers, the idea of civil war over economic issues doesn't seem that far-fetched these days. And Ron Paul definitely thinks the Fed should be ended. In TIME's recently cover story on the militia movement many said these groups are powder kegs looking for a catalyst. So why not a Fed policy committee meeting.
"Powder kegs looking for a catalyst"? Mixed metaphor, I guess. Powder kegs looking for a spark would be what I think he's looking for.
Do not get involved in arguing the point, for now. Just consider the power ascribed to the militias by the language.
The article concludes:
"It is a gross exaggeration," says Allan Meltzer, who is a top Fed historian at Carnegie Mellon. "I cannot recall ever learning about riots or civil war even when the Fed made other mistakes." When I called, David Rosenberg was traveling and couldn't talk, but he did send me a quick e-mail to stress that he has never, ever suggested that any moves the Fed makes will lead to a militia uprising.
Some smart people, though, including Meltzer, it appears, and Rosenberg do think the path of quantitative easing that the Fed looks likely to embark on is the wrong move. John Taylor, a top Fed scholar at Stanford, says eventually you will have to pull the support out, and when you do a year from now when the economy is recovering he thinks it could be quite disruptive. So even if you don't double dip now, you might double dip then. And even if you don't it would make for a slow recovery. Others, such as Raghuram Rajan, who has became famous for warning about the possibility of a financial crisis back in 2005, believe low-interest rates could be creating new bubbles in say gold or commodities.
So it seems clear what the Fed is likely to do. How the economy, the militias and the rest of us react is up in the air. The count down is on. T minus 15 days to Fedamageddon. See you there, hopefully.
Now I don't know what the Fed will or will not do. Based on past experience, you can just about guarantee that what it does will a. be unconstitutional and b. make things worse.
The interesting thing here is that a major magazine is speaking about the militia movement in terms that admit its potential power and the assumption of the role of counterbalance to government tyranny.
They're starting to get the Founders' point.
Mike
III
8 comments:
The writer "MAY" get the point, but the real question is, does the FED get the point? And do they care? I don't think they do, they have been corralling the sheeple for so long I think they believe they are untouchable and this arrogance will be the spark. As a side note, the propagandist states the militias are "powder kegs looking for a catalyst", (s)he is wrong, the Fed is the powder keg and their policies are the spark.
Guess we'll just have to wait and see, but I'll bet that any announcement from the Fed will be buried in the election results.
The article SEEMS to say web site Zerohedge, the Tea Party and the militias are crazy for thinking that Fed policies will cause more major harm. Throwing Ma and Pa Saver under the bus.
Commenters beg to differ. They are tearing commenter Roger a new one for saying even more deficit spending is the answer but Obama and Congress are "too timid to do what's necessary."
Looks like some like Roger WANT that civil war of '10.
I usually read the proffered link before reading your take on it, Mike, and I came to several of the same conclusions.
Yes, mixed metaphors and conflations abound, not to mention the misuse of the word 'militia'.
The very fact that this stuff is being printed in a major media outlet is the real story.
Somebody needs to sit Bernanke down and have an old fashioned "come to Jesus"! Even if QE2 (Quantitative Easing V2.0) doesn't cause a civil war, (and the article says it shouldn't) it ia still gonna be bad news.
Now if we could just get the "Fiat Fools" to lay off spooling up the printing presses for a while and if the next congress actually gets seated and if they can pass tax cuts without His Obamaness VETOING them (shitload of "ifs" there ain't it?) we might not actually have commencement of hostilities for a couple of years yet.
I just hope the feds hold off on their "Waco" or "Ruby Ridge" or whatever till at least next summer. I'm due to come into some money in February and I'd REALLY like a chance to spend some of it.
Yup! Somebody REALLY needs to brief Bernanke on the details of bovine consumption of leafy vegetables. SOON!!!
Bad Cyborg X
Taylor, it won't be the QE itself that causes the unrest/civil war, it'll be the $5 gallon gas and other results from the inflation that cause it.
"Powder kegs looking for a catalyst"... I like my mixed metaphors shaken, not stirred.
QE2 will cause massive inflation. Some food item wholesale prices are already up 40 to 50%. If nothing else, it's crosshairs on every saver in the country, and damned near a death sentence to anyone on Social Security (no COLA this year).
It could be our own private Holodomor.
What I found interesting was that one comment about how there has never been violence over Fed decisions in the past. At what point in American history since the creation of the Fed have we had more crisis of confidence in the very nature of the nation state than right now?
This is just illogical.
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