Wrong Evidence

18 08 2015



St. Louis Fed official: No evidence QE boosted economy

The Federal Reserve is putting some of its post-crisis actions under a magnifying glass and not liking everything it sees.

In a white paper dissecting the U.S. central bank’s actions to stem the financial crisis in 2008 and 2009, Stephen D. Williamson, vice president of the St. Louis Fed, finds fault with three key policy tenets.

Specifically, he believes the zero interest rates in place since 2008 that were designed to spark good inflation actually have resulted in just the opposite. And he believes the “forward guidance” the Fed has used to communicate its intentions has instead been a muddle of broken vows that has served only to confuse investors. Finally, he asserts that quantitative easing, or the monthly debt purchases that swelled the central bank’s balance sheet past the $4.5 trillion mark, have at best a tenuous link to actual economic improvements.

It takes St. Louis to bring some sense to the world.

Even though, ironically, last year, the St. Louis Fed quit releasing BOGUMBNS data.

Williamson is looking at it the wrong way.  It’s not that quantitative easing was supposed to improve the economy but somehow didn’t, it’s that quantitative easing was meant to keep stock indeces higher than they would otherwise be, and that it has.


Bad Mood

17 08 2015


Moody’s docks the city’s credit rating, because…

The agency attributed the St. Louis downgrade to the “city’s weak socioeconomic profile; reliance on earnings taxes which are due for voter reauthorization in 2016; a relatively narrow financial position; and a high debt burden.”

The reason why the city earnings tax is up for voter reauthorization next year is because of 2010’s Proposition A.  I think Moody’s is worried for nothing if they think city voters will vote to do away with the earnings tax.  It’s just that I think that there was an ulterior motive behind Prop A.  (And while you’re there, you’ll find what turned out to be a spot on prediction about someone who used to be in Congress from CD-2).

That Problem Was Solved Six Years Ago

20 07 2015


Seattle Mayor be like:  How can we get Muslims to have mortgages when Shari’ah forbids interest?

Minnesota be like:  We know! We know!

Market Opportunity

26 03 2015

Birmingham, Alabama


Obama Delivers a Warning, the Link Between Payday Lenders and Wall Street


Obama’s choice of Alabama to pitch new regs on payday lending was no accident: the Southern Poverty Law Center reports that there are four times as many payday lenders in the Heart of Dixie as McDonald’s restaurants, and the high poverty rate makes for easy pickings. At the same time, the think tank Demos says the predatory lenders tend to feed on poor black communities, where the promise of easy money without a credit check is tempting bait. But the profits from the lenders flows straight to Wall Street – one key reason industry lobbyists are continuing to fight the new regulations. That includes defeating a cap on astronomical interest rates, described as the Holy Grail of consumer protection advocates.

This is a little bit weird.  Baraq Obama is about as much of a WS whore as any President has been in my lifetime, yet this is the same Baraq Obama that is trying to choke off the payday loan industry among other industries using Operation Choke Point.  I wonder what the scam is.

However, one of my many axioms is that people usually get the interest rates they deserve.  If there was money to be made in drawing loans to the Bellcurvii of Alabama and charging lower interest rates than the payday loan joints, then someone would be doing it.  Especially in today’s economy where it’s hard to find a place to park money at anything close to an interest rate, much less a decent one.

Wrong Building

5 03 2015



Don’t raise rates, protesters tell St. Louis Fed

About a dozen chilly protesters gathered outside the Federal Reserve Bank of St. Louis on Thursday to complain that the Fed may soon make it harder to find work.

The Federal Reserve is widely expected to raise interest rates later this year, a move intended to prevent inflation in years hence. The protesters complained that higher interest rates can also cut off the jobs recovery.

The Fed represents “the 1 percenters,” said Derek Laney, an organizer with Missourians Organizing for Reform and Empowerment. “They are the big banks, the big corporations, and their mandate is to keep inflation low at all costs.”

You would have done better to hold this protest in New York.  That’s where these decisions are made.  The St. Louis Fed mostly does data gathering and research.

This isn’t 1875 anymore; St. Louis doesn’t that much matter nationally.

BTW, MORE, inflation hurts people on fixed incomes.

Don’t Audit Me, Bro

24 02 2015

Washington, D.C.

Yellen’s yellin’.

And don’t go around thinking that the Fed has something to hide.  Instead, if any Audit the Fed bill really gains any serious political momentum, the NYT and the owners of the megaphones will do nothing but scream about the extremism, the craziness and the social undesirability of people that want the Fed audited, complete with audio-visuals of Auschwitz, Southern lynchings and the Murrah Federal building.

The Shock of All Time

21 08 2014


The FerGaza Strip is full of check cashing and payday loan joints.

Next thing you know, they’re going to tell us that it’s full of nail salons and weave shops.

My 66th axiomJust as most people get the government they deserve most of the time (See #6), most people get the interest rates they deserve most of the time.  Meaning rent-to-own joints and payday loan joints aren’t ripping people off or being usurious.


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