This QE really drove these oil prices

[piezoe]

It's not just oil. Speculative money chased everything from oil to farmland, stocks, whatever. If you make saving money worthless, and reward spending, you shouldn't be surprised when you have no savers and people living on nothing but debt, or chasing yield.

But the zealots and sorcerers will tell you that we had to do it, or else we'd have seen another great depression (which we will probably still get in some form). These wizards will tell us that Bernanke was a genius and that Yellen is a gift from God. Isn't that right, piezoe?

Yes that's right. Both Bernanke and Yellen are extremely bright and well qualified economists.

The effects of QE are obvious to most everyone. Prior to the financial collapse of 2007-9 the savings rate of American consumers was net negative, and speculative money chased everything from oil to farmland, stocks, whatever. You seem to be suggesting that that QE had something to do with this negative saving rate and speculative binge. QE did not start until after 2007!

 

[piezoe]

“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.” – Ludwig von Mises

You seem to be a little confused. Qualitative easing is one of the tools available by the Fed to counter, in conjunction with Treasury and legislative measures, demand and credit contraction.

What von Mises is referring to in your quote of him is the danger of excessive credit expansion leading to market bubbles, excessive speculation and risk taking. That might describe somewhat accurately the financial climate in the U.S. leading up to the Great Recession.

You seem very confused on these matters. Weren't you one of the ones predicting disastrous hyperinflation when the Fed began QE? Well the Fed still has to unwind, so there is still a chance you will get to blame at least something on the Fed that makes logical sense, but I'm afraid hyperinflation won't be it. You see, the danger when the Fed starts to unwind is not hyperinflation but rather not enough inflation. If the Fed isn't extremely careful they could tip the country back into recession. That phase is a ways off it seems, so I wouldn't lose any sleep worrying about it just now.

 

[piezoe]

It seems like as soon as they stopped the Fed pump, these oil prices tumbled. We were told this whole QE program would not have any effect on prices. The verdict is in and we know that was a lie. We now know that everybody had to pay high gas prices because of the Fed pump and they haven't even started to unwind it. We are getting an idea of what the bill will look like.

Huh?

 

[piezoe]

Wild, just to clarify, my "Huh" is not because QE does not affect prices -- of course it does! But who told you "this whole QE program would not have any affect on prices"? Who would say such a ridiculous thing?

 

[piezoe]

You seem to be a little confused. Qualitative easing is one of the tools available by the Fed to counter, in conjunction with Treasury and legislative measures, demand and credit contraction.

What von Mises is referring to in your quote of him is the danger of excessive credit expansion leading to market bubbles, excessive speculation and risk taking. That might describe somewhat accurately the financial climate in the U.S. leading up to the Great Recession.

You seem very confused on these matters. Weren't you one of the ones predicting disastrous hyperinflation when the Fed began QE? Well the Fed still has to unwind, so there is still a chance you will get to blame at least something on the Fed that makes logical sense, but I'm afraid hyperinflation won't be it. You see, the danger when the Fed starts to unwind is not hyperinflation but rather not enough inflation. If the Fed isn't extremely careful they could tip the country back into recession. That phase is a ways off it seems, so I wouldn't lose any sleep worrying about it just now.

I had to quote myself. Damn I hate it when I can't go back and make a correction. I said above
"Qualitative Easing" :eek:-- hope no one caught it-- it should of course be Quantitative Easing. There is such a thing as qualitative easing, but that's when you alter the mix of bonds, such as in operation"twist" which I've seen referred to as "qualitative" easing. Actually I object to that use of the term. I think qualitative easing should be reserved for an actual lowering of the quality of bonds on the balance sheet. But what would you call twist then. In that operation short term (I think ten year) were exchanged for (I think) the long bond. "Maturity twist", "maturity easing"???

 

[Tsing Tao]

Yes that's right. Both Bernanke and Yellen are extremely bright and well qualified economists.

The effects of QE are obvious to most everyone. Prior to the financial collapse of 2007-9 the savings rate of American consumers was net negative, and speculative money chased everything from oil to farmland, stocks, whatever. You seem to be suggesting that that QE had something to do with this negative saving rate and speculative binge. QE did not start until after 2007!

No, cheap and easy money - which has been going on long before QE. All laid at the foot of the Fed.

Reading your commentary on Bernanke and Yellen is just comical.

 

[Tsing Tao]

You seem to be a little confused. Qualitative easing is one of the tools available by the Fed to counter, in conjunction with Treasury and legislative measures, demand and credit contraction.

What von Mises is referring to in your quote of him is the danger of excessive credit expansion leading to market bubbles, excessive speculation and risk taking. That might describe somewhat accurately the financial climate in the U.S. leading up to the Great Recession.

You seem very confused on these matters. Weren't you one of the ones predicting disastrous hyperinflation when the Fed began QE? Well the Fed still has to unwind, so there is still a chance you will get to blame at least something on the Fed that makes logical sense, but I'm afraid hyperinflation won't be it. You see, the danger when the Fed starts to unwind is not hyperinflation but rather not enough inflation. If the Fed isn't extremely careful they could tip the country back into recession. That phase is a ways off it seems, so I wouldn't lose any sleep worrying about it just now.

First, it's Quantitative Easing that the Fed has been embarking on (for the most part).

Second, I posted a quote from Mises that struck me as relevant, that's it. You can assume whatever you want about why I posted it, but you know what they say about assuming.

Can you show me the posts I made regarding hyper-inflation?

I'd like to re-read them. Take your time.

 

[der_kommissar]

Yes that's right. Both Bernanke and Yellen are extremely bright and well qualified economists.

The effects of QE are obvious to most everyone. Prior to the financial collapse of 2007-9 the savings rate of American consumers was net negative, and speculative money chased everything from oil to farmland, stocks, whatever. You seem to be suggesting that that QE had something to do with this negative saving rate and speculative binge. QE did not start until after 2007!

No, cheap and easy money - which has been going on long before QE. All laid at the foot of the Fed.

Reading your commentary on Bernanke and Yellen is just comical.

Exactly...Piezoe tries to be "slick" with his escape artist antics, but it's so transparent...(i.e. disregard all of the blunders PRIOR to 2007 that led to a negative savings rate) as if that somehow justifies more monetary hijinx.

 

[wildchild]

Wild, just to clarify, my "Huh" is not because QE does not affect prices -- of course it does! But who told you "this whole QE program would not have any affect on prices"? Who would say such a ridiculous thing?

All I have heard from these QE supporters was that this QE was such a great thing and we should be doing more of it. Over the last 5 years there have been plenty of people making that exact claim.

I want it pointed out that as soon as the QE ended, the price of oil tanked and now the price of gas is down over a dollar and will drop more. My vehicle takes about 20 gallons to fill up. That means every fill cost me more than $20 more because of QE. Why is this cost not being pointed out to the public?

 

[piezoe]

First, it's Quantitative Easing that the Fed has been embarking on (for the most part).

Second, I posted a quote from Mises that struck me as relevant, that's it. You can assume whatever you want about why I posted it, but you know what they say about assuming.

Can you show me the posts I made regarding hyper-inflation?

I'd like to re-read them. Take your time.

I could not remember if it was you concerned about hyperinflation. That's why I asked. Sorry I am not inclined to look for those old posts. It really does not matter that much. I just recall many posts by various ET members who were expressing concern about hyper inflation when the Fed started QE. They were wrong of course.