Threats from the White House Press Secretary Robert Gibbs were issued this morning on Fox News Sunday. When asked what the financial repercussions might be if Ben Bernanke failed to be re-confirmed, he stated: “The best way to not have to deal with those repercussions is to support Ben Bernanke for a second term.” Mr. Gibbs further said that senators could support stability in the financial system by backing Mr. Bernanke.
The stock market has lost all of its gains for the year as of Friday. Coincidence this happens just before the senate convenes to vote on Bernanke’s reconfirmation? I think not. Long-time readers of FedUpUSA have seen enough evidence that the Federal Reserve has been the biggest force in the stock market since last March to see clearly what has happened to our ‘free market’ economy.* It has been the Federal Reserve’s low-interest rate liquidity that has allowed the member banks through their trading desks to elevate market price on very low volume. Take away the liquidity and……
I would encourage the Senate to refuse to bow to threats and financial terrorism.
* Long-time readers will remember this from September 24, 2008:
Posted by Karl Denninger
The Fed has claimed that this is a “liquidity crisis.” Really Ben? Then perhaps you can explain this?
Note that this is an intentional drain of “slosh”, or liquidity, from the banking system. $125 billion in the last four days drained?
You wouldn’t be trying to intentionally cause a bank failure or two to bolster your call for the $700 billion “bailout” plan, or perhaps intentionally lock the short-term credit markets, would you Ben?
If the market has a liquidity crisis, why would you be intentionally draining reserves from the banking system? Don’t you think you ought to explain that to Congress?
What was the market’s response to Ben’s pulling the $125 Billion in liquidity?