Daily Archives: January 9, 2012 @ 9:25 am (Monday)

the Fed and the dollar

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Imagine being on the FOMC and in the mainstream paradigm

In 2008 you moved quickly to make sure the US would not become the next Japan

You cut rates to 0, even faster than Japan did.

You provided unlimited liquidity to the dollar money markets,
both home and abroad.

You did trillions of QE, sooner than Japan did.

You announced you expected rates to stay down for two years.

etc. etc. etc.

And what do you have to show for it, 3 years later?

GDP marginally positive, much like Japan
Inflation working its way lower to Japan-like levels, especially housing and wages.
Employment stagnant a la Japan.

And now, after 3 years of 0 rates, and trillions of QE, the dollar is going up, much like the yen did.
After the Fed has done all it could think of to reinflate, and then some.

And all just like MMT suspected.
And for what should be obvious reasons.

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politics shifting towards JG?

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U.K. to Propose Work-for-Benefits Program, Sunday Times Reports

By Svenja O’Donnell

Jan 8 (Bloomberg) — The U.K. coalition government is planning a compulsory community work program for the long-term unemployed, the Sunday Times said, citing Employment Minister Chris Grayling.

The plan will include stopping benefits for as many as three years for those who refuse to sign up, the newspaper said.

Grayling has indicated his support for the plan, saying a “work for dole” program will help curb the U.K.’s expenditure on benefits for the jobless, the paper said.

People who have been unemployed for three years or more will be forced to work unpaid for six months under the terms of the program, the Sunday Times said.

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