Shannon Love

“Quantitative Easing” Equals “$600 Billion Tax Increase”

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Although most economists are loathe to admit it, inflating the currency really serves as a form of stealth taxation. The entire goal of inflation is to allow the issuer of the currency to buy things with the full initial value of the money being inflated while simultaneously reducing the value of the money held by everyone else. In other words, inflation transfers the value represented by monetary tokens (bills, banking computer data, etc.) from the people who hold old tokens (the bills in your wallet) to the people printing the money (in America, the Fed).

Now, toss in this little bit of goodness:

The Fed usually [sic] manages the economy by adjusting short-term interest rates. With those rates already near zero, Fed officials had to dust off a strategy for boosting the economy that debuted during the darkest days of the financial crisis. The Fed plans to create money, essentially out of thin air, and then pump it into the economy by buying Treasury bonds on the open market. These purchases are to be finished by the end of June, the Fed said.

Stop laughing at the “manages the economy” bit and focus on the emphasized text. What is really going on here?

What is really going on is that the Fed is stealing $600 billion dollars of real value from your pocket and using that value to fund the US Federal government through Treasury bonds. The real transfer of real value goes: You–>Fed–>Government.

It’s a damn tax increase craftily carried out using the finance system.

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Bleeding and Purging to Balance the Humors of the Economy

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Peter Suderman at Reason [h/t Instapundit] observes in his article on “Quantitative Easing” that:

There’s a similar sentiment behind arguments for the Fed’s new policy, a simplified version of which goes something like this: Quantitative easing is probably a good idea. Why? Because we need to do something to increase economic activity. Fiscal stimulus is off the table for political reasons (at least). Inflation has been running a little low, which makes it an obvious policy lever. Expanding the monetary supply—and thus spurring on inflation— may not do much, but it’s what can be done. And that means that, well, quantitative easing is a good idea. QE2, motherfucker!

The old saying, “when the only tool you have is a hammer, all problems look like nails,” doesn’t really give the entire picture. More comprehensively, we should say that when the only tool policy makers have is a hammer, they developed incredible baroque theories to rationalize why hammering is the solution to every problem.

We have a rather compelling historical precedent for the incredible power of tool driven rationalizations.

Up until the mid-1800s and the development of scientific medicine, medical theory in the Judeo-Christian-Islamic world centered on the Hippocratic/Galean theory of humors.

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Who Does Obama Get Really Mad At?

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Anyone else notice that the President seems to reserve his most forceful rhetoric for comments directed at his fellow Americans?

Where is that kind of rhetoric when it comes to people who are actively shooting at us? He has virtually groveled before hostile foreigners while the first bit of emotion he showed was directed at BP (“going to kick their asses”). Heck, he won’t use the term “enemy” when talking about, well, the enemy but he will use it in the context of internal politics.

After badmouthing everything Bush did in Iraq, he kept on Bush’s Secretary of Defense. Then he put his primary Democratic rival in as Secretary of State. By doing both, he signaled he was marginalizing foreign policy in his administration. He simply doesn’t care what foreigners do good or bad.

Leftists have long accused non-leftists as vilifying and seeking to attack “the other”. Leftists have lectured us for decades about how non-leftists mark out those deemed outgroups, e.g., foreigners and our own native criminals, and then sought to direct the violence-based coercive power of the state against those outgroups. In short, non-leftists like to shoot Nazis and hang serial killers.

However, leftists also wish to direct the violence-based coercive power of the state against other human beings. However, they make it clear that directing the power of the state against foreigners and native criminals is barbaric and seldom, if ever, needed. Attacking foreigners and criminals is beneath them. Only Neanderthals think like that. All dictators and criminals need is a stern talking to. Who then do they wish to direct the power of the state against?

Their neighbors.

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Hah, Hah, I Was Right, Thrppppt!

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One shouldn’t gloat but…

… I was right about the bogus Lancet Iraq Mortality Survey.

There were actually two studies done by the same Soros funded group of “researchers”. I did fourteen posts on the first study back in 2004-2005, and I demolished its conclusions using simple methodological arguments that you did not need a degree in statistics to understand. The study was so bad and so transparently wrong that you didn’t need to understand anything about statistics or epidemiological methodology, you just needed to know a little history and have a basic concept of scale.

In my very first post on the subject I predicted that:

Needless to say, this study will become an article of faith in certain circles but the study is obviously bogus on its face.[emp. added]

That prediction proved true. Leftists all over the world not only accepted the 600% inflated figure without hesitation but actively defended the study and its methodology. I confidently made that prediction almost exactly 6 years ago because I was even then beginning to understand a factor in leftists’ behavior: they are nearly completely controlled by delusional narrative

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