Refresh  
Add this Page to Facebook!   Submit to Twitter   Submit to Reddit   Submit to Stumble Upon   Pin It!   Fark It!   Tell A Friend  
Printer Friendly Page Save As Favorite Save As Favorite View Article Stats
42 comments

OpEdNews Op Eds

Reply to Ellen Brown

By (about the author)     Permalink       (Page 1 of 1 pages)
Related Topic(s): ; ; ; ; , Add Tags Add to My Group(s)

Valuable 7   Well Said 6   Must Read 5  
View Ratings | Rate It

Become a Fan
  (377 fans)

opednews.com

From youtube.com/watch?v=5UBMh3yfy2A: THE DARK HISTORY OF THE FEDERAL RESERVE
THE DARK HISTORY OF THE FEDERAL RESERVE
(image by YouTube)


Ellen Brown speaks for people and against interest groups that exploit the people. I value her columns.

In her July 7 OpEdNews column, Ellen discusses other ways that the Federal Reserve could have used quantitative easing that would have benefited those whose home mortgages are underwater, and she points out ways that counties could use their eminent domain powers and their legal standing with respect to the Mortgage Electronic Registration Systems in order to help homeowners rather than the big banks.

Ellen Brown is correct that the Federal Reserve could have made better use of its power, if the purpose had been to help homeowners. For example, the Fed could have performed the role of the New Deal's Home Owners Loan Corporation, as some of us pointed out at the time.

However, the big bank executives who sit on the board of the New York Fed and the former bank executives in control of the US Treasury and federal financial regulatory agencies were and are primarily concerned with saving their banks from the consequences of the fraud and greed over which they presided. The purpose of quantitative easing is to support the balance sheets of the oversized banks that were quickly declared to be "too big to fail."

Interest rates tend to move together. By purchasing bonds, the Fed drove up the prices of the debt-related derivatives on the banks' books, thus boosting the solvency of the banks.

If the purpose of quantitative easing had been to help real estate by lowering interest rates and stimulating the economy, the policy did not succeed, as Ellen Brown correctly points out, and would have been discarded. But the policy did help the banks, and continued despite the failure to achieve its ostensible purpose, which was merely a cover for a bank bail-out. The Fed had to curtail quantitative easing because the increase in new money unmatched by growth in real goods and services threatened the value of the dollar in foreign exchange markets.

Because of its adverse effect on wealth, the real estate collapse did reduce consumer spending and impaired the economy's growth performance. However, the main cause of reduced consumer spending is the decline in real median household incomes caused by jobs offshoring.

It was the movement offshore of manufacturing and tradable professional skill jobs, such as software engineering, that gave middle class income and US GDP to foreign countries. The real estate boom was the Federal Reserve's response to the lack of income growth. The Fed substituted an expansion of consumer credit for the missing growth in consumer income. Once the credit expansion outran the ability to service the debt, the bubble popped. As the economy and homeowners are now loaded up with debt, it is difficult to bail out the situation with more debt, no matter how innovative the schemes.

The schemes Ellen Brown discusses are worth thinking about. However, unintended consequences of the schemes should also be considered. For example, expanding the scope of eminent domain can have applications less desirable than fixing underwater mortgages.

Keep in mind that county governments are motivated by revenue concerns just like banks and other private interests. We should hesitate to jump to the conclusion that county governments have any more good will toward the people than does the federal government.

 

http://www.paulcraigroberts.org/

Dr. Roberts was Assistant Secretary of the US Treasury for Economic Policy in the Reagan Administration. He was associate editor and columnist with the Wall Street Journal, columnist for Business Week and the Scripps Howard News Service. He is a contributing editor to Gerald Celente's Trends Journal. He has had numerous university appointments. His book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West is available here. His latest book,  How America Was Lost, has just been released and can be ordered here.

Add this Page to Facebook!   Submit to Twitter   Submit to Reddit   Submit to Stumble Upon   Pin It!   Fark It!   Tell A Friend
The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.

Writers Guidelines

Contact Author Contact Editor View Authors' Articles
Related Topic(s): ; ; ; ; , Add Tags

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Libya - The DC/NATO Agenda And The Next Great War

The Road to Armageddon

American Job Loss Is Permanent

A Story...The Last Whistleblower

Pakistan TV Report Contradicts US Claim of Bin Laden's Death

Comments

The time limit for entering new comments on this article has expired.

This limit can be removed. Our paid membership program is designed to give you many benefits, such as removing this time limit. To learn more, please click here.

Comments: Expand   Shrink   Hide  
14 people are discussing this page, with 42 comments
To view all comments:
Expand Comments
(Or you can set your preferences to show all comments, always)

I suppose both factors that you and Ms. Brown emph... by Steve Hudson on Tuesday, Jul 8, 2014 at 11:52:11 PM
I am convinced that until the Federal Government a... by Scott Baker on Wednesday, Jul 9, 2014 at 2:00:58 AM
I admire your ideals, but unless you obtain the po... by Gerald Hiles on Wednesday, Jul 9, 2014 at 3:46:18 AM
I'm afraid you're quite right. Sir Evelyn De Roth... by Ron Brassfield on Wednesday, Jul 9, 2014 at 8:00:55 AM
There are a number of "Positive Money" groups now,... by Scott Baker on Wednesday, Jul 9, 2014 at 8:51:25 AM
Getting the President of the U.S. to take monetary... by Pal Palsimon on Saturday, Jul 12, 2014 at 12:20:14 AM
I wouldn't put any faith in the Marxist-Leninist i... by Steve Hudson on Wednesday, Jul 9, 2014 at 11:10:11 AM
Why did you drag Marx into this?I know far more ab... by Gerald Hiles on Wednesday, Jul 9, 2014 at 11:47:09 AM
Re: the finite planet limiting material growth: I... by Jill Herendeen on Monday, Jul 21, 2014 at 11:29:18 PM
Please elaborate on how our planet is not finite a... by Gerald Hiles on Tuesday, Jul 22, 2014 at 4:35:41 AM
New technologies, most of which never get out to t... by Jill Herendeen on Tuesday, Jul 22, 2014 at 10:35:45 AM
What area of technology are you qualified in?Have ... by Gerald Hiles on Tuesday, Jul 22, 2014 at 11:50:06 AM
I can read. ... by Jill Herendeen on Tuesday, Jul 22, 2014 at 12:12:33 PM
OK most people can read, but can you answer questi... by Gerald Hiles on Tuesday, Jul 22, 2014 at 1:28:08 PM
Well, of course I CAN answer questions, often enou... by Jill Herendeen on Tuesday, Jul 22, 2014 at 8:51:57 PM
Admirable, Sir! ... by Ron Brassfield on Wednesday, Jul 9, 2014 at 4:45:32 AM
Ellen is good and I corresponded with her a few ti... by Gerald Hiles on Wednesday, Jul 9, 2014 at 3:02:14 AM
It does look as if the sordid handwriting is on th... by Ron Brassfield on Wednesday, Jul 9, 2014 at 4:49:56 AM
These are the comments that may be true, but that ... by Pal Palsimon on Saturday, Jul 12, 2014 at 12:26:31 AM
Are governments inherently corrupt, or are they co... by Scott Baker on Wednesday, Jul 9, 2014 at 8:54:49 AM
I do not think that money, per se, is at the root ... by Gerald Hiles on Wednesday, Jul 9, 2014 at 11:34:59 AM
I've come to believe just the opposite. Human bei... by Scott Baker on Wednesday, Jul 9, 2014 at 12:20:01 PM
Excellent comment and it's not just incentives but... by Robert S. Becker on Wednesday, Jul 9, 2014 at 12:37:23 PM
Of course people are plastic, atop that vast funda... by Gerald Hiles on Wednesday, Jul 9, 2014 at 1:37:23 PM
I would have pressed the teacher to be more specif... by Maxwell on Wednesday, Jul 9, 2014 at 3:03:58 PM
At the time we were talking about what goes on on ... by Scott Baker on Wednesday, Jul 9, 2014 at 4:44:50 PM
Sometimes it might be the fear of assassination (s... by Pal Palsimon on Saturday, Jul 12, 2014 at 12:30:04 AM
Well and succinctly said. Thanks for this. I've be... by Ron Brassfield on Wednesday, Jul 9, 2014 at 4:43:31 AM
Good point about the questionable motives of local... by Derryl Hermanutz on Wednesday, Jul 9, 2014 at 4:56:24 AM
An excellent synopsis of the way things operate at... by Chris Cook on Wednesday, Jul 9, 2014 at 7:30:20 AM
Yes, but not only monetary reform. We need to tax... by Scott Baker on Wednesday, Jul 9, 2014 at 8:59:37 AM
As usual, your articulate summary captures the ess... by Robert S. Becker on Wednesday, Jul 9, 2014 at 10:00:09 AM
Thanks PCR, I value your articles too! And cite t... by Ellen Brown on Wednesday, Jul 9, 2014 at 9:43:26 AM
Any local government that is bold enough to stand ... by Ellen Brown on Wednesday, Jul 9, 2014 at 8:31:25 PM
Your comment about more chance to get 3rd parties ... by Pal Palsimon on Saturday, Jul 12, 2014 at 12:35:07 AM
Deconstruct the Kleptocracy, reconstruct democracy... by Harry Lord on Wednesday, Jul 9, 2014 at 12:38:00 PM
Yes. I am sure the actual legality of the way our ... by Pal Palsimon on Saturday, Jul 12, 2014 at 12:38:57 AM
Our fundamental problem is not economics, but biol... by Daniel Geery on Wednesday, Jul 9, 2014 at 7:08:46 PM
Nice sentiments, Daniel, but I don't think just fo... by Steve Hudson on Wednesday, Jul 9, 2014 at 10:23:54 PM
I know. I just try to look for the brightest light... by Daniel Geery on Wednesday, Jul 9, 2014 at 11:16:11 PM
Eco-nomics. Could it be Daniel and Steve that bio... by Burl Hall on Thursday, Jul 10, 2014 at 2:57:47 AM
I made a comment on another site (Alternet or CD) ... by Daniel Geery on Thursday, Jul 10, 2014 at 12:35:48 PM

 
Want to post your own comment on this Article? Post Comment