FedUpUSA

Bernanke: As Long As Wages Aren't Rising, Who Cares About Prices?

 

We have this gem of an article today from Bloomberg:

“Headline inflation is beginning to have a greater influence on monetary policy, but not yet at the Fed,” said Crescenzi, who helps manage $1.2 trillion at Pimco in Newport Beach, California, as executive vice president. The central bank “remains anchored or hinged to the core rate,” which excludes food and energy costs.

So, Mr. Bernanke is purposely only considering ‘core’ inflation when judging the overall inflation rate.  So, the soaring prices in your energy costs to drive your car and heat your house don’t count.  Also not considered are your rapidly increasing food prices.  I’m sure for you and I it’s no problem to forego heat and food, right?  These are apparently, discretionary items to Mr. Bernanke.

The article goes on to specify what would cause Mr. Bernanke to become concerned about inflation:

“The dominant driver” of core inflation “will still be wage inflation.”

High U.S. unemployment will keep salaries in check, limiting the biggest influence on broader prices, Crescenzi said. Bernanke’s strategy of focusing monetary policy on the core rate contrasts with European Central Bank President Jean- Claude Trichet and Bank of England Governor Mervyn King. They are signaling growing discomfort with prices, prompting investors to anticipate faster interest-rate increases in the euro area and U.K.

Uh huh.  Essentially, the only thing that will concern the Federal Reserve would be if wages started to rise.  Yes, the one thing that might actually relieve a little of the massive financial stress the American people are experiencing would signal a serious problem to Mr. Bernake.   It appears that our friends over in Europe have made loud enough objections to this insane and evil policy to cause their Central Banks to at least take note and acknowledge that price inflation in essentials is becoming alarming and concerning.

However, here in the US, this article makes it pretty clear:  Ben Bernanke and the Federal Reserve think rising prices, especially in items necessary for survival are a-okay — no problem!  Rising wages?  Forget it.   That will elicit immediate and swift action by the Federal Reserve to stop that in its tracks.  They purposely want to keep your wages low and the prices of necessities going up!

Considering wages in the United States have been stagnant at best for the past decade and falling on average 30-40% over the past three years, while core inflation (you know, the necessities Bernanke doesn’t even consider) is running +8-10%, this is clearly a 50% reduction on buying-power.  FIFTY PERCENT.  Let that sink in.

US monetary policy is robbing you blind and destroying not just you and your family, but your family generations into the future.  And why are they doing this?  Same reason we’ve been talking about now for 3 years:  to hide the insolvency of all the big TARP banks.  You know, the same ones that are fraudulently foreclosing on millions of homes.   You’d think that Americans would at least be as angry as their European counterparts by now.   I guess all that protesting might conflict with American Idol.

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