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Gold bars, future oil, cotton ain’t gonna hire Joe the Plumber November 8, 2010

Posted by WillardWhyte in Economy, Politics, Wall Street.
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I found this take on Ben’s money-move to be quite on target. This in particular from Richard Fisher, president of the Fed bank in Dallas:

I could envision such action would lead to a declining dollar, encouraging further speculation, provoking commodity hoarding, accelerate the transfer of wealth from the deliberate save and unfortunate, and possibly place at risk the stature and importance of the Fed.

But Ben knows this, just as he knows that the odds of monetary policy stimulating job growth and greater consumption in the U.S. are extremely long.  It’s his only play, knowing now the fiscal side is headed toward the austerity solution demanded by the voters, ostensibly. And that will take billions out of circulation in 6-8 months.

With no new wage growth on the horizon at anything but the top end, throwing accelerant on commodities and equities and potential bubbles abroad is intentioally destablizing, a sort of drop-the-gloves-and-hope-the-sparks-fly approach that depends on some of the embers landing in the deadwood and warming many.

But Ben undervalues the monkey still perched on the back of money markets —  the jonesing for fast money made with money, not output of goods and services in demand. The dice and spinning wheels and flashing lights still draw the biggest crowd, and garner the loudest roars from the onlookers.

It’s going to help some folks make a good chunk of change on the house, Ben. That’s about it, because a “real job” is still the chump play.

The folks sitting on the mounds of cash are not coming off until your cheap money is all gone and it becomes clear the only way to make money is the old-fashioned way.

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