The Great Geithner/Bernanke B*fight
Once you see it...
It begins... now.
Chairman of the Federal Reserve Ben Bernanke has come out in support of maintaining the Bush tax cuts saying that it would be a means of stimulus for the U.S. economy.
Just hours before, U.S. Treasury Secretary Timothy Geithner said that the Obama administration would allow the tax cuts to expire. Geithner's hand was forced after three Senate Democrats came out in support of extending the cuts.
Here's Bernanke's crackpot scheme in a nutshell:
“In the longer term, I think we need to be taking steps to reassure the American people and the markets that our fiscal situation is going to be well controlled,” Bernanke said under questioning from Representative Spencer Bachus of Alabama, the committee’s senior Republican. “That means that if you extend the tax cuts, you need to find other ways to offset them.”
That's where he fires up the press and buys up whatever he doesn't already own that hasn't been written off by now. The plan is genius because he'll be able to find all variety of crap asset to buy as banks have been clinging to some of it as long as possible. It's still worth something, right?
Because his only other option is... oh wait, devaluation.
He's already proven he likes to do it, what's to stop him? Tim Geithner? Please.