In response to an FT article by Sam Fleming on 21st August 2016, entitled ‘Questions about central bank firepower loom at Jackson Hole’
http://www.ft.com/cms/s/2/c0f89cc4-6655-11e6-8310-ecf0bddad227.html#ixzz4I3QNTBDh
The Prologue:
This Friday in Jackson Hole, Wyoming, heralds the annual gathering of central bankers, economists, and a few tame journalists (the latter are invited so that nothing intelligent or remotely resembling the truth spills out from the hole). Their mission: to discuss, debate, and pronounce on how to save the world…again. Think of them as like Bruce Willis but without the oily vest.
Over the next few days the speculation on what Janet Yellen will announce will mount, and despite the fact that there is a good chance listeners will be asleep or suicidal by the end of her speech, the mainstream belief that she knows what she is doing is still bearing up under the strain.
This is a 'starter for ten' from the FT…expect the mediocrity to rise along with the tension as Friday approaches, ending with the crescendo of Bruce emerging from Jackson Hole with his imaginary vest barely intact.
What follows is the opening snippet from the article, followed by my response. I recommend a full reading of the article if you wish to enjoy the olympic levels of point missing now being attained by our glorious leaders and the complicity of the 4th Estate:
“As investors squabble over when the Federal Reserve might lift short-term interest rates, central bankers meeting in Wyoming this week are likely to be debating what they might do if a future downturn forces them to put monetary policy into reverse” – Sam Fleming
Alternatively:
As investors gradually come to the realization that the Fed’s theories are total bunkum, central bankers meeting in Wyoming this week are likely to be having private huddles away from microphones where they can discuss:
1. How they can persuade politicians to monetize the debt in a slightly more honest way than it has been done so far, through the use of helicopter money and direct government spending
2. How they will cope with the growing cynicism as more investors wake up to the fact that central bank tentacles are now deeply entwined in stock markets as well as bond markets, and realize that they have absolutely no way of getting out of the positions they have taken
3. How they can tweak their ‘communication strategies’ so that ‘more of the same’ sounds like ‘something new’
4. How they will deal with the fact the inflation and employment situation that faces real people will not be masked by ‘headline figures’ for much longer
5. Next steps in their long-term strategy to discredit ‘saving’ and encourage the acceptance of perpetual spending through debt acquisition. Including:
· How to make NIRP seem normal
· The next stage in the abolition of cash, e.g. further restrictions on cash transactions, the introduction of time dependent cash
6. How they can ‘assist’ the election of Hillary Clinton without dispelling the myth that they are outside politics
7. What to do if Donald Trump wins the election and decides to audit or even replace the Fed – either of which would likely reveal a number of ‘transactions’ and ‘activities’ that are questionable at best, illegal at worst - pointing to criminality in the highest echelons of the Eccles Building, Wall Street and Capitol Hill
If there’s any time left I suspect Dr. Yellen would be grateful to anyone who can give her a few tips on how to make ‘snake oil’ sound like ‘medicine’. Ten minutes with Alan Greenspan or Larry Summers ought to do the trick.