Bernake mumbles about fulfilling his dual mandate of price control and full employment as his reasoning for printing more money. Psshaww. There is no deflation, prices aren't going down. Prices just aren't going up as fast as they were. Various measures of inflation show prices rising anywhere from 0.9 percent to 1.5 percent on a year-over-year basis. Full employment or any employment from QE2? Doubt it. The reason behind this is as reported down page " to clear toxic assets from bank vaults, and at the same time transfer good non-toxic money to those same banks. It is the greatest swindle in history after Fannie and Freddie."
QE2 will accomplish the same as QE1, more wealth distribution to the top 2%, increases in oil, commodities and metal prices and more hoarding of cash reserves by the banksters. All courtesy of George Bush, Barack Obama, Alan Greenspan, Ben Bernanke, Hank Paulson and Timmy Geithner. An united, non-partisan destruction of the middle class at the behest of the wealthy political donating class. If you're in the top 2% you're great, top 10% you're fine, bottom 80-90% you're fucked. Welcome to 21st century Amerika. A nation of men, not of laws.
"The problem is that U.S. quantitative easing is driving the dollar downward and other currencies up, much to the applause of currency speculators enjoying a quick and easy free lunch...
...the whole idea of a fixed exchange rate smells of manipulation, but in fact it is easier to "manipulate" a floating exchange rate than a fixed one...
...this US policy was precisely the kind of beggar-thy-neighbour currency manipulation the IMF was set up to avoid. Instead the IMF is questioning whether a pegged exchange rate is manipulative. Welcome to doublespeak..
...We have been here before. Back in the mid-1980s, Detroit blamed its woes not on the inferior quality of American cars, their gas guzzling, or the fact that the Japanese prefer not to carry all their belongings in the back or to have the steering wheel on the left. They blamed the yen-dollar exchange rate.
Political pressure pushed the yen up by more than the 27% being sought today by the US Congress for the yuan. It did as little to save Detroit then as a rise in the yuan would do today"
Rouibini weighs in:
"A world where over-spending countries need to reduce domestic demand and boost net exports, while over-saving countries are unwilling to reduce their reliance on export-led growth, is a world where currency tensions must inevitably come to a boil...
...The next stage of these wars is more quantitative easing, or QE2. The BoJ has already announced it, the Bank of England (BoE) is likely to do so soon, and the Fed will certainly announce it at its November meeting. In principle, there is little difference between monetary easing – lower policy rates or more QE – that leads to currency weakening and direct intervention in currency markets to achieve the same goal. In fact, quantitative easing is a more effective tool to weaken a currency, as foreign exchange intervention is usually sterilized..
...though the US pretends not to intervene to weaken the dollar, it is actively doing precisely that via more QE."
Japan's pissed at Korea for currency manipulation though Japan recently has done the same thing:
"The rift between Japan and Korea which has spilt into the open in the past 24 hours, with a Japan minister protesting Korea’s currency policy, only to be rebuffed by the BoK governor, is significant for the rifts that are opening up WITHIN Asia"
Yves at Naked Capitalism adds:
" In the case of China, it has accumulated the biggest foreign exchange reserves in relationship to GDP of any country in the last 100 years, possibly ever. Its nearest competitors? The US on the eve of the Great Depression, and Japan at the peak of its bubble."
"Whether intentional or not, QE2 is also an effective tool in devaluing the dollar, an outcome that we suspect the Fed wouldn’t mind, since, other things being equal, it increases U.S. exports. As we pointed out last week, this would exacerbate the currency war that has already started"
"The FT quotes an unnamed “senior European policymaker” as saying the American policy was irresponsible. The Russians were blaming the US for creating global currency instability."
If you're going to blame China, blame China. The Obama administration has no balls:
"At the same time, according to administration officials briefed on the decision, the Treasury Department plans to announce on Friday that it will delay its semiannual report on foreign-exchange rates, deferring a decision on whether to brand China a currency manipulator"
Someone else who see's Bernanke as a liar:
"Ben’s lies will cost us trillions, and quite possibly our way of life."
Another of Bernanke's dissatisfied customers:
"It won't get banks back into lending, nothing will, and it won't get anyone a job or a home or anything else. What it WILL do, though, is transfer another inordinate amount of money from the public to the private sector. QE 2 isn't meant to alleviate YOUR problems, it never was nor will be. Come on, be honest, what government program in the past 3 years has done anything for you?
QE 1 and 2 through 826 have, and always will have, only one objective in mind: to clear toxic assets from bank vaults, and at the same time transfer good non-toxic money to those same banks. It is the greatest swindle in history after Fannie and Freddie. Move over Charles Ponzi!"
China issues a warning to the international community:
"Given a sluggish economy and huge amount of debts, driving the value of the dollar down is in line with America’s interests, both in short term and in long term. The international community ought to stay vigilant about the strong motive for active devaluation under the guise of a market-based move."