Easy Money Whores Demand to Know Where the Good Crack Is, Dr Bernanke
How dare you scare them like that. The discount rate eh? The crack dealer is not taking away the pipe at last, he switched to a lower grade coke is all. Don't get scared, you little easy money whores, Bernanke isn't growing that large of a pair any time soon, you can continue your misguided bubble-blowing circle jerk.
US Federal Reserve chief Ben Bernanke is expected to shed light this week on the central bank's sudden decision to hike an emergency bank-lending rate, triggering speculation on monetary tightening.
Bernanke is scheduled to appear before the financial committee of the House of Representatives on Wednesday and the Senate banking panel the next day, where his testimony will be closly scrutinized by jittery markets.
The Fed's increase Friday of the discount rate, the interest it charges on emergency loans to banks, rattled stock markets. Investors feared the central bank might be moving faster than anticipated to withdraw critical support measures for the US economy, as it recovered from a brutal recession.
The Fed's worst case scenario is about to play out and my guess is this discount rate nonsense is not the Fed shooting a warning shot but them testing what sort of pushback they'll get for taking away the bottle. Obviously if Bernanke gets chewed out by a bunch of Congressional asshats, they are watching their worst nightmare become reality. What was that about the Fed not being handmaiden to the Treasury, Dick Fisher?
As Kansas City Fed's own Thomas Hoenig pointed out, if the Treasury comes knocking on the Fed's door to just print some more "exits" from the hole we can't dig ourselves out of, it can't end well for either party. If the Fed says no on "principle" (which it claims to have, constantly touting this "importance of Fed independence" nonsense), Congressional asshats trying to win votes won't like how pissed off their constituents will get. If they say yes (because they have yet to show that they know how to just say no), they're perpetuating the assumption that they've sold out and compromised this supposed holy agenda of independence.
So? I'm curious to hear how the crack dealer will appease the addicts. Your turn, Zimbabwe Ben.