Ron Paul to Ask Fed Why After Trillions in Free Money, Unemployment
Is Still Sky High
by Tyler Durden
is relishing the Fed's third and only mandate these days, namely
to send the Russell 2000 to 36,000 and cotton limit up to infinity
and beyond, while everyone else is terrified to short stock in advance
of what increasingly appears like near certain additional quantitative
easing, congressman Ron Paul has announced that the first Monetary
Policy subcommittee meeting will focus on one of those two now forgotten
Fed mandates, that of creating jobs.
the answer to all of these problems is simple: no debt ceiling raise.
If the Fed can't monetize any more debt and make the Primary Dealers
ever richer (now that the PD ranks have just been expanded from
18 to 20 to include SocGen and derivative (!) trader MF Global,
and its CEO Jon Corzine) from commissions on indirect debt monetization,
its power is gone. But that will mean doing something far less theatrical
than a few hearings, and far more responsible: such as preventing
rampaging inflation across America (see cotton chart posted previously).
Announces Subcommittee Hearing On The Federal Reserves Impact
Policy and Technology Subcommittee Chairman Ron Paul announced today
the Subcommittee will meet for a hearing to examine the impact of
Federal Reserve policies on job creation and the unemployment rate.
The hearing will be held on Wednesday, February 9th at 10 am in
room 2128 Rayburn.
Chairman Paul said, Im very pleased to hold our first
subcommittee hearing in the new Congress on a topic that could not
be more critical, namely unemployment. Despite enormous amounts
of monetary and credit expansion by the Federal Reserve in recent
years, the nations unemployment picture remains bleak. While
many focus on the impact of fiscal policies on employment, the effect
of monetary policy often goes unexamined. In my view we are now
experiencing the bust that inevitably results from the misallocation
of capital and human resources in a period of artificially cheap
credit. It is important to understand the Federal Reserves
role in creating todays unemployment crisis, while also highlighting
that high unemployment and low economic growth can persist even
in the face of tremendous monetary inflation.
Reserve has taken unprecedented action to provide liquidity to financial
markets and some U.S. corporations; however, unemployment remains
above 9 percent. The hearing, entitled Can Monetary Policy Really
Create Jobs?, will focus on the Feds recent actions, the likelihood
those actions will reduce unemployment, and the critical role of
the private sector in job creation.
While the Obama
administration and Democrats in Congress believe increased government
spending will improve the nations economy, Republicans on
the Financial Services Committee know economic growth depends on
providing the private sector, especially small businesses, with
the certainty they need to create jobs. The Feds policies,
as well as the Obama administrations unsustainable debt and
spending, continue to prevent small business owners from growing
and hiring because of continued uncertainty over new taxes, higher
interest rates, and the expanding role of government in the economy.
On November 3, 2010, the Federal Reserve announced that it planned
to purchase $600 billion in long-term Treasuries (dubbed QE2).
This is the second time since the 2008 financial crisis that the
Federal Reserve has engaged in quantitative easing. The latest round
of quantitative easing, along with the Feds action to bailout
financial companies, has added trillions of dollars to the government
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