By Mitchell Feierstein
Janet Yellen’s been nominated by Joe Biden as Treasury Secretary, despite a poor record as Federal Reserve chair. This is typical of the unwarranted confidence placed in the central bankers who’ve caused so much financial pain.
The US Federal Reserve was established on December 23, 1913, and, despite its name, it is not a bank or part of the federal government. The Federal Reserve (or ‘Fed’) is owned and acts on behalf of its members, such as JPMorgan, Goldman Sachs and Berkshire Financial Services. Do you think the Fed cares about the wealth inequality its reckless policies have caused – policies that have benefited the .01 percenters that own it? Since 1913, the US dollar’s value has declined by 97 percent. Can the Fed really be considered to be doing a good job?
Consider, for example, these remarkable comments from central bankers. In March 2007, Fed Chairman Ben Bernanke said the subprime mortgage crisis was “likely to be contained,” and in May of that year, he added, “The vast majority of mortgages, including even subprime mortgages, continue to perform well. We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”
In October 2007, he said, “It is not the responsibility of the Federal Reserve – nor would it be appropriate – to protect lenders and investors from the consequences of their financial decisions.”
In November 2010, during a Federal Reserve conference on Georgia’s Jekyll Island, former Fed chairman Alan Greenspan said a lesson he learnt from the 2008 crisis is how the taxpayers implicitly subsidized the “financial intermediary system in the US.” He went on to point out that “there was rampant fraud in a lot of what was going on in these markets. We need far higher levels of enforcement of fraud on statutes – not new ones, existing ones. Things were being done that were certainly illegal and clearly criminal.” The look on then Chairman Bernanke’s face when Greenspan dropped this truth bomb was priceless.
In 2015, the Financial Times reported how the Bank of Japan’s Haruhiko Kuroda “reimagined” its monetary policy on the belief in Peter Pan’s ability to fly. No wonder Japan’s economy has had no growth for nearly 40 years. And the frightening part is the West began embracing this failed economic model years ago.
Then there was Fed chief Janet Yellen, who, in 2017, said she didn’t believe we would see another financial crisis in our lifetime. How many times were Yellen’s economic forecasts during and after the global financial crisis proven wrong? Too many to count.
She often repeated how the Fed’s temporary emergency measures would be removed and we would have ‘lift-off’ of interest rates. But, of course, none of this ever happened, and we are still waiting, over 12 years later. Yellen kept bailing out billionaires with near-zero interest rates while killing savers and increasing the wealth inequality gap. The oligarchs of Silicon Valley love Yellen. And Wall Street adores her, as well as the Fed’s magic printing presses, with their unlimited capability.
Yellen’s counterpart at the time, Mark Carney, who was the head of the Financial Stability Board and the Bank of England, as well as the ex-governor of the Bank of Canada, was singing from the same hymn sheet. Carney, mirroring the policies of Bernanke and Yellen, inflated grotesque property bubbles in Canada and the UK by pushing interest rates to 900-year lows, eviscerating savers and elderly retirees while landing taxpayers with the bailout bill for the billionaires and bankers who’d blown up the system.
Carney is another who got it wrong about normalized interest rates in both the economies his policies destroyed. He promised “escape velocity” in the UK, but, like Yellen’s ‘lift-off,’ both crashed on the launch pad. Their policies still protected and enhanced the oligarchy, though.
Central bankers such as Yellen and Carney were paid handsomely for this. One must surmise that their ilk always intended to enrich the powerful oligarchs in the cantons of Wall Street, London, and Silicon Valley to the detriment of everyone else. This is the model: propaganda, lies, and censorship are used to ensure globalism that fosters tyrannical rule, which, in turn, is beneficial to maintaining the status quo demanded by the oligarchy. Be an obedient apparatchik and earn a golden parachute when you exit.
The policies of these two central bankers have created the most significant wealth inequality ever seen and have allowed for the financial plunder that benefited the .01 percent and turbo-charged the oligarchy. But now, Yellen and Carney have transformed themselves into social justice warriors, championing equality, racial equity and climate change. In fact, Joe Biden has deified Yellen, saying, “We might have to ask Lin-Manuel Miranda, who wrote the musical about the first Treasury Secretary, Hamilton, to write another musical for the first woman Treasury Secretary, Yellen.”
It beggars belief how, after years of lies and economic destruction, lipstick is put on pigs to re-brand the oligarchs’ go-to patsies, Yellen and Carney. And now, Yellen may get a chance to do some serious damage should she become Treasury Secretary. When considering central bankers like these, we should remember the old maxim: beware of false prophets.