When today Fed chairman Ben Bernanke appearing before the U.S. Senate Committee on the Budget bluntly stated that, states under increasing financial distress should not expect a bailout from the Fed — today's hearing making clear that, both the Senate and the Fed are keenly aware of the default risk dozens of states and municipalities are facing and that Congress is not interested in a bailout further saddling the Treasury — frankly, I was aghast. Yet that not one senator challenged the Fed chairman on his resistance toward assisting municipalities was equally appalling.
You mean the Fed is willing to stuff its balance sheet with lord knows how many "shitty deals" sold as AAA-rated MBS, but it will not assist states of the union — all with taxing power over their citizens — and help them get over the same hump those purveyors of systemic bankruptcy have been given a financial free pass that they might remain viable in time? How is it states are not facing a "liquidity crisis," too, Mr. Chairman? Not one limp noodle on the Senate committee could summons courage to ask this of the über incompetent Fed chairman.
So much for the Fed's political "independence." Certainly, the weight of ill-gotten bonuses awarded throughout the financial industry these past couple years — a gift undeniably facilitated by the Federal Reserve itself — just got astronomically heavier.
Yet well enough is the fact that, the Fed chairman went out of his way to confirm the entire financial system continues to rest on a foundation of fraud and swindle. All thought the Fed's objective is to stabilize markets should be washed away.
Over the past three years periods during which momentum of the U.S. Dollar Index turned positive consistently have marked moments when global financial distress was weighing on the stock market. Lo and behold the present moment once again finds this measure likewise ominously disposed. In light of this, then, it is an interesting coincidence that, the stock market's technical state remains entirely foreboding.
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