November 8, 2010

No More Bailouts!? Where Is The Vocal GOP Opposition to Quantitiave Easing?

America handed the Democrats a hefty smack in the face Nov. 2nd, telling them to get their collective heads out of their backsides on the economy.  One of the GOP's mantras going into the election was no more bailouts.  With 60+ plus new GOP members heading to the House in January, you would think there would be some room for optimism on the economy, but I can't say I see any hopeful indicators, case in point, the Fed's quantitative easing scheme. 

Essentially, Ben Bernanke and company at the Federal Reserve are going to print a bunch of money out of thin air and use that newly printed cash to buy the toxic assets of the banks for prices way more than they are worth.  This gets the crappy stuff off of the bank's books (and puts it on the taxpayer's).  Sweet deal that for the big banks (which are partially owned by the Fed). Where is the GOP leadership's voices of condemnation on this backdoor bailout for the big banks? I don't hear a peep coming from any of the leadership in the Senate or the House. You won't hear it from Team Obama.  The Obama administration is sold out to the banking sector, correction, the big banking sector.   Small banks are not getting to participate in this largess, if they get into trouble, they are simply allowed to die like dogs in the street.

 The GOP has run on a platform that says we need to get back to economic sanity, but QE is going to accelerate rising commodity prices.  What that means for you and me is that we are going to be paying more for gas and food. In fact its already happening.  In my neighborhood, gas is up to $2.90/gallon and I'll bet you've noticed a change too. Oil is up around $80/barrel and $100/barrel prices could be right around the corner.  Nearly everything we consume has to be transported, so that means price hikes on nearly everything and when you add in the commodities increases that are coming, its going to get downright ugly for the middle American family.

My personal jury is still out on whether the Fed is the great satan or not.  There are plenty of people who think it ought to become extinct.  But I do know that this unelected central bank is about to have a massive impact on the economy with a backdoor bailout of the big banks.  The kicker is that its going down without a peep from republicans and unsurprisingly with the willing collusion of the Obama administration.  My party claims its looking out for the economic interests of working class Americans.  Yet, we're only days into a return to control of the House and more clout in the Senate again and already falling down on the job.
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