02/21/11 Tampa, Florida – Naturally, I was aghast that things have gotten so bad that even the Bank for International Settlements (the infamous BIS) finally got around to noticing that the results of three decades of central banks creating more and more money is not, as they thought, A Truly Wonderful Thing (ATWT).
They write that “drastic action” is now needed, and that “the fiscal problems currently faced by industrial countries need to be tackled relatively soon and resolutely.”
Instantly I jump to my feet and shout, “Whereas yesterday, nothing needed doing, nor was there any need for any action at all, except to idly sit by as things got worse and worse as central banks created more and more money so that governments could deficit-spend? But now we need drastic action, you BIS morons?”
Nobody notices my rude objections, and the BIS blithely goes on that “Failure to do so will raise the chance of an unexpected and abrupt rise in government bond yields at medium and long maturities, which would put the nascent economic recovery at risk.”
Well, duh! Let me write this down! Higher interest rates will put the economy at risk, but creating so much money, for so long, by so many central banks, to accommodate so much more government and government spending, to keep nominal interest rates at literally zero and real, inflation-adjusted interest rates negative, will not? Hahaha!
Well, perhaps I am being scornful and disrespectful only out of the long habit of being scornful and disrespectful of all central banks, including the execrable BIS, which is so worthless that it has created its own fiat currency, the SDR! I mean, how low can you go?
On the other hand, they seem to understand that high interest rates cause slowdowns in the economy, so maybe there is hope that they will say something else intelligent!
No such luck. The very next sentence from these incompetent, neo-Keynesian, fiat-currency loving morons is that failure to take “drastic action” to cut government spending “will also complicate the task of central banks in controlling inflation in the immediate future and might ultimately threaten the credibility of present monetary policy arrangements.” Hahahaha!
You can tell that I am upset by the way my fists are clenched into Mogambo Fists Of Rage (MFOR), an action seemingly at odds with how I laugh – Hahahaha! – the dreaded Mogambo Laugh Of Scorn (MLOS) in a perfect demonstration of Utter Mogambo Contempt (UMC): Monetary policy has no credibility, you morons! None! Zero!
In fact, it makes me chuckle and shake my head in dismay to consider how in the hell can any half-witted, leftist, neo-Keynesian, econometric idiot, like these BIS idiots, possibly think that the Federal Reserve would have any, any, ANY credibility after achieving Total Freaking Failure (TFF)? Again I laugh the Mogambo Laugh Of Scorn (MLOS)! Hahaha!
If they wanted respect and credibility, the bankers would have insisted upon re-instituting the gold standard, or actually stabilizing the money supply as if we were on a gold standard! And then we would not have any of these catastrophic economic problems, and the sun would shine, and somewhere men would laugh, and somewhere children shout, but, until then, there is no joy in Mudville, the Bernanke has struck out.
But those betting against Bernanke and the Federal Reserve by buying gold and silver will see the sun shine, and men will laugh, and children will shout, “Whee! This investing stuff is easy!”
The Mogambo Guru
for The Daily Reckoning
The Mogambo Guru
Richard Daughty (Mogambo Guru) is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the writer/publisher of the Mogambo Guru economic newsletter, an avocational exercise to better heap disrespect on those who desperately deserve it. The Mogambo Guru is quoted frequently in Barron's, The Daily Reckoning , and other fine publications. For podcasts featuring the Mogambo, click here.
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…the sun would shine, and somewhere men would laugh, and somewhere children shout,
For on the mound the great pitcher
THE MOGAMBO
has struck the Keynesians out!!!!!!!!!!
All Hail Mogambo!
Richard, very well done again, even though this one sounds a bit different than usual. I suppose it has a more serious quality about it than usual. Eye opening for sure, Thanks, CanadaNorth
We’re Freaking Doomed! I’m buying silver as much as I can, but as a poor man gold is too high. Oil, out of my reach.
It will be nice though when the time comes and of all the warnings I advise friends about what the Fed is doing, they just keep charging and working at their jobs going in to debt without any understanding of what they are doing, and I’ll be selling my many many American Eagles for lots and lots of money!! Whee!
And, they can’t come in my bunker either.