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Just ask yourself this question: If I have $1M and I can decide between two options a) tomorrow my money is worth $2M b) tomorrow my money is worth $500k
by fnid2 17y ago
Just ask yourself this question:
If I have $1M and I can decide between two options
a) tomorrow my money is worth $2M
b) tomorrow my money is worth $500k
Which option would you choose? These bankers are human beings. They are naturally and understandably biased. Not only are they making these decisions for themselves, but they are making them for all their friends, family, and business associates -- all of whom are also millionaires and billionaires.
I don't see it as much a conspiracy theory as an understanding of human nature.
Originally, the fed was created by a secret committee of bankers on a remote island. It was rushed through congress quietly -- I know, because I read the decades old NY Times article covering the legislation at the Will Rogers Museum.
Then, if you watch the recent Moore film, you'll see that the current bail out was voted down in congress, then secret meetings led by many of these bankers, GS and the like, prompted a revote and they rushed it through again -- when it passed.
What Aaron said is pretty accurate. The bankers aren't looking out for main street and the jobs won't be back for a while.
I've been trying to sell a house now for almost a year and many people want it and none of them can get a loan -- they've tried. They have jobs. They have income and the ability to repay the loan, but the banks just aren't giving out any money. Contrast that to 4 years ago when you didn't even have to have a job at all or verify income to get a million dollar loan -- I know, because it was my job to build information systems to help the subprime match makers connect home buyers with the banks who wanted to give them the loans.
When I realized how dirty it all was -- I quit and started my own company and I'm very glad I did.
- byrneseyeview 17y agoBut it's really more like his choices are: a) His $1 million earns ~3% interest and depreciates by 2% per year, or b) His $1 million earns ~4% interest and depreciates by 3% per year. You're arguing that these guys are promoting multi-trillion dollar swings in the country's wealth in order to earn a couple more basis points on their investments. If you're going to posit a Greedy Ben Bernanke, why is he being so slow and cautious? He can probably make, at most, 1% per year extra by manipulating the value of the dollar. Or he could take a suitcase full of cash.
- yummyfajitas 17y agoAdditionally, he probably doesn't even know which choice will make him money. Most likely his money is managed in a blind trust, which means he has no control or knowledge over how it is invested. For all he knows, inflation will help his portfolio. In the most likely event, his money is invested in a mix of equities, stable funds and bonds, and all his money does is track the general health of the economy (with a smaller upside/downside due to hedging and diversification).
- wdewind 17y agoI understand that legally this is the way it's supposed to be, but do you really expect us to believe that Bernanke doesn't understand what's in his portfolio? Come on... You're also dismissing the social wins aspect of this: you definitely can't argue that Bernanke doesn't know the way his friends are betting, even if he's "blind" to his own portfolio. Bernanke doesn't have to win directly off this for there still to be a possibility of him making corrupt decisions that help both him and his social network.
- yummyfajitas 17y agoI understand that legally this is the way it's supposed to be, but do you really expect us to believe that Bernanke doesn't understand what's in his portfolio? Come on... Bernake doesn't know what's in his portfolio, because his money managers don't tell him. That's why many agency heads are required to put their money into a blind trust. If you have evidence to the contrary, by all means notify the proper agency (I think OTS, not really sure). As for Bernake's friends, I expect most of them don't tell him (or anyone else) how they are betting. If I tell you my trading strategy, you can turn around and take my money.
- wdewind 17y agoYou're acting like Bernankes friends are sitting around at a poker table, when in fact they are the house and we are all playing blackjack.
- 17y ago