Planet Moron

But We Have to Do Something! And Apparently It Really Doesn’t Matter What.

Naturally, people were horrified at the unspeakable atrocity visited upon Sandy Hook Elementary School this past Friday and want to know what measures are being taken to see to it that such tragedies are avoided in the future:

Q: What should we do?

A: First, we need to act as swiftly as we can.

Q: Why?

A: It is commonly understood that the best decisions are usually made in the heat of the moment, when passions are highest and people are so blinded with grief or rage that they are willing to accept any solution no matter how pointless and ineffective.

Q: You mean like the Transportation Security Administration?

A: Exactly! For example, Senator Joe Lieberman has already carefully laid out his reasoning for the need for more gun control.  You’ll have to bear with us, it’s full of technocratic jargon (you know Joe!), but this is the kind level-headedness we need from our leaders at a time like this:

"We've got to continue to hear the screams of these children and see their blood until we do something?"

Q: That doesn’t sound that level headed. Does anybody have any specific proposals?

A: Well, University of Rhode Island Professor Erik Loomis has put forth a detailed plan meant to address the root causes of the tragedy:

“[I] want Wayne LaPierre’s head on a stick.”

Q: Now wait a second. There are important and profound arguments to be made for gun rights that can certainly be debated in an informed manner.

A: That may be true, but as Professor Loomis puts it so eloquently,

“[F]*ck the NRA."

Q: Okay, are there any serious legislative proposals being made?

A: Of course there are. For example, Senator Diane Feinstein has called for a reinstatement of the assault weapons ban.

Q: The killer used one of the previously banned assault weapons?

A: No.

Q: That doesn’t seem very productive.

A: Well, the White House has also proposed to require background checks at gun shows.

Q: The killer purchased his firearms at a gun show?

A: No.

Q: Then how does it make any sense to propose a grab bag of gun control legislation most of which was already in place in Connecticut where the laws are among the toughest in the nation and did nothing to deter this?

A: What are you, some kind of monster?  There are dead kids out there!

Q: It’s just that there are reasonable arguments as to the role gun rights play in securing civil rights and actually saving lives.

A: Do you like dead kids?

Q: What? No! Of course not.

A: Because it’s starting to sound like you like dead kids.

Q: No, it’s just that mass murders are actually down.

A: Dead kids.

Q: Schools have never been safer.

A: Dead kids.

Q: And these massacres occur almost exclusively in areas where the government has specifically banned guns strongly suggesting…

A: Dead kids.

Q: You’re not even trying now.

A: Don’t have to.

J.

Fighting for the Working Man. No, Literally…

There has been some controversy of late over a little tussle that occurred in Michigan where state legislators were voting on a “right to work” law that could potentially undermine union influence and power in the state.  Naturally, union members turned out to protest the law however some people have misinterpreted their enthusiasm and vigor. To help clear things up we thought we’d address the confusion with a quick Q&A:

Q: What happened? It appeared that union members physically attacked people engaging in constitutionally protected free speech.

A: No, no, nothing could be further from the truth.

Q: Look at the video, one guy just started laying in on Steven Crowder with left and right roundhouse punches.

A: That was just a metaphor.

Q: A metaphor?

A: Sure. The individual was simply expressing the essential conflict between left and right common in non-parliamentary democracies in which two dominant parties yptically “fight it out” if you will, in the field of ideas.

Q: But he was literally punching the guy in the face in an actual field.

A: Think of his face as a canvas on which the union member/interpretive artist was painting a picture.

Q: The guy punched him in the face! This is absolutely outrageous and under no circumstances can it be allowed to go unpunished.

A: Whoa, whoa, easy on the inflammatory rhetoric there. You wouldn’t want to incite some Tea Party nut into engaging in violence, such as criticizing Obamacare, or possibly creating a sign expressing disapproval of the current administration.

Q: That’s violent?

A: Absolutely. Violent to anyone’s sense of fairness.

Q: What about actual violence, like physically tearing down a tent with people still inside?

A: That was a misunderstanding.

Q: What about the Michigan legislator who promised “there will be blood?”

A: Hey, that could mean anything.

Q: And why isn’t the media paying any attention to this? They turned over rocks looking for signs of Tea Party violence but they can’t be bothered to report on this?

A: Report on what?

Q: The union violence and threats from elected Democrats?

A: There was union violence and threats from elected Democrats?

Q: Yes.

A: Well, we didn’t read anything about that in the papers…

J.

We Demand a Recount!

Okay, so our guy lost. But did he lose in the larger sense?

Yes, he lost there too.

But then, we do not feel we “wasted” our vote.  After all, Mitt Romney is exactly the same amount of not president as Gary Johnson.

Still, Barack Obama is, by any measure that places a value on freedom, liberty, and self-determination, a miserable failure, and yet he still won. How could this be?

Because no one uses any measure that places a value on freedom, liberty, and self-determination. After all, freedom sounds kind of hard, liberty is probably a lot of work too, and self-determination might actually involve getting a job and moving out of your parent’s basement.

Free stuff on the other hand has three major attractions:

1. It’s free.
2. You don’t have pay for it.
3. The price is $0.00.

We're starting to see the appeal

As you can see from the chart below, Barack Obama likes to give away free stuff.

You know you’re a big spender when you increase spending faster than strict fiscal disciplinary Republicans do.

Of course, we all expect free things from our government, like free water in disasters. Sure, you can’t get any, but at least it’s free.

Then there’s the free money the Federal Reserve creates out of thin air. Hey, it’s free!

And the free health care, and free cell phones, and free college tuition.

You might be saying to yourself, “There’s no such thing as a free lunch.”

Well, that all depends on which side of the table you’re sitting on, doesn't it.

In other news:

“With the election of progressive Elizabeth Warren in Massachusetts and Tammy Baldwin in Wisconsin, Obama’s longtime backers feel the liberal spirit inside the president could be unleashed: climate change, gun control, and immigration reform perhaps heading to the top of the agenda.”

Does anyone know what the weather is like in the Cayman Islands this time of year?

J.

Our Utterly Pointless Presidential Endorsement

Presidential candidates do not typically covet a Planet Moron endorsement. There are several reasons for this:

1) They have never heard of Planet Moron.

Okay, there’s only one reason.

It also doesn’t help that the majority of Planet Moron readers are ineligible to vote due to prior felony convictions, lack of any fixed address, or the inability to climb out of the bottle long enough to fill out a voter registration card.

Be that as it may, we feel a duty to let our faithful reader(s) know where we stand in this election.  To help follow our thinking, we thought we’d first highlight the issues that are most important to us this presidential cycle.

Not being assassinated by the president.

We have not been particularly concerned with this issue in prior presidential elections partly because we did not know that the President can assassinate American citizens.

We really need to keep up with current events better.

Regardless, we would very much prefer that the candidate we vote for does not believe he can kill us.  Sorry, that may be considered extreme but there are just some things we are not willing to compromise on, and the President blowing us up together with our family, friends, and neighbors with Predator drones is just one of those things that kind of leaves a sour taste in our mouth.

Avoiding fiscal catastrophe

Trillion-dollar deficits may not seem like much, but consider this: If you were to line up one trillion one-dollar bills end to end they would reach from here to the moon and back again an extremely large number of times.

Yeah, it’s that much.

So, in order to get our vote, our candidate has to demonstrate he or she is serious about the deficit.

Rejecting the use of a leviathan government to trample what’s left of our freedoms

We are well aware of the fact that most people are for trampling people’s freedoms.  Other people’s freedoms. Not theirs.  Here at Planet Moron we don’t care what you do as long as you don’t bother us.  

So, let’s see how the major candidates, President Obama, and Governor Romney, fare with our issues.

Killing us:

Neither sees a big problem with that.

Avoiding fiscal catastrophe.

Both believe that is good in theory. In practice, not so much.

Rejecting leviathan government trampling our freedoms.

Both are pretty much good to go with a leviathan government trampling our freedoms.

Clearly, there’s a lot to think about there. In the meantime, let’s take a look at the minor-party candidates:

Virgil Goode, Constitution Party

Virgil Goode is so serious about addressing our deficits that he doesn’t think it’s important to even mention two of the biggest drivers, Medicare and Medicaid, and of the third, says:

“We must preserve and protect Social Security.  Social Security is owed over two trillion dollars.  Social Security should be repaid and have real money in the Social Security Trust Fund and not IOU's.”

Somehow.

Mr. Goode also believes the path to prosperity is through a trade war.

Rocky Anderson, Justice Party

Rocky Anderson feels strongly about our rights and freedoms and wants to repeal major parts of the Patriot Act. And then make unions more powerful, increase the minimum wage to $10 an hour and force us all to fight “climate change.”

Jill Stein, Green Party

Jill Stein has a great many plans for spending our money including:

“Create a Corporation for Economic Democracy, a new federal corporation (like the Corporation for Public Broadcasting) to provide publicity, training, education, and direct financing for cooperative development and for democratic reforms to make government agencies, private associations, and business enterprises more participatory.”

No one knows what any of that means including Jill Stein.

Gary Johnson, Libertarian Party

For the most part, it appears that Gary Johnson isn't interested in killing us, leading us into fiscal catastrophe or trampling our freedoms.

It looks like we found our guy.

Will he win? No. But if he gets to 5% maybe, just maybe, we can start to turn this thing around.

And for those who suggest that we are “throwing our vote away,” well, so are you.

Happy voting everyone, and not to worry, no matter who wins, we plan to be here over the next four years to document the perfidy, incompetence, and corruption, that will surely follow.

J.

Economic Patronizing

This week the President released "Economic Patriotism: A Plan for Jobs & Middle Class Security," (pdf) a detailed roadmap consisting of many dozens of words including "middle class," "tax cuts," and "middle class."

Also, “middle class.”

And “tax cuts.”

In fact, here are some representative excerpts from the plan:

“I want to continue those tax cuts for middle-class families and for small businesses.”

Extending the middle-class income tax cuts… would prevent 97% of small business owners from facing a tax increase.

We can make college more affordable by continuing tax credits to help middle-class families afford college tuition.

The Obama Record: Cutting taxes for the Middle Class.

To strengthen the middle class, President Obama passed wide-ranging tax relief.

And the President has provided new tax cuts to help the middle class afford higher education and health care.

The plan makes sure millionaires aren’t paying lower tax rates than many middle-class families.

President Obama’s plan keeps middle-class tax cuts in place.”

Keep in mind the plan is only 11 pages long.

Regardless, it is pretty clear that the President believes the middle class needs middle class tax cuts for the middle class.

Additionally, the President’s plan includes the most important element of any economic policy agenda if it’s going to be taken at all seriously:

A thoroughly detailed and specific set of pictures of Barack Obama.

In fact, on every single page the small text is crowded out by huge, glossy, full-color pictures of Barack Obama.

What do these pictures tell us the President is going to do if he is reelected?

For one, he is going to eat breakfast. Experts will tell you that breakfast is the most important jobs plan of the day.

He is also going to bother you at work.

Even if that means standing at high, overly reflective counters to no obvious purpose.

He will also come over to your house and watch your children.

He will consult with your doctors regarding the proper course of your treatment.

And he will wear Dockers on casual Friday.

Finally, we have a reason to vote for a President, rather than just against his opponent.

J.

But what about the children? Of Agriculture Department Grant Officials, We Mean.

We’re likely to hear a lot about cutting the deficit in tonight’s debate, but do the candidates really understand the hard truths they are about to face when it comes to reducing federal spending?

Agricultural Secretary Tom Vilsack understands. He understands all too well the pain that will be caused by looming cuts to his department, lamenting that:

“October 1st is the start of a new fiscal year, but it also is the end of many of the programs authorized under the 2008 farm bill.”

What programs, you ask? Programs that touch people’s lives. Programs that provide people the quiet dignity and  opportunity to share in the bounty of our nation that is their right as citizens.

Programs that finance appearances by the Alabama Watermelon Queen:

“Partner with the Alabama Watermelon Association, Inc. (AWA) to promote the consumption of Alabama’s watermelon through appearances of the Alabama Watermelon Queen at various events and location.”

These programs are part of the 100% essential Agricultural Marketing Service’s Fruit and Vegetable Programs, Specialty Crop Block Grant Program (pdf).

But it’s not all about watermelon queens. Secretary Vilsack knows we are running unsustainable deficits and has cut all the fat out of his programs leaving only the bone. Such as:

“Explore and develop markets for vegetables that are popular in Hispanic culture but are not available locally for the minority populations in Houston and Henry counties in southeast Alabama.”

For the record, if you don’t think this is an essential expenditure, then you’re a racist.

“Partner with Jeff Smeenk to determine the optimum rhubarb for a juicing product and present the project results to other specialty crop producers in Alaska.”

Look, if we don’t do it, the Russians will.

Also, you should never pass up an opportunity to say "Jeff Smeenk."

“Partner with the Arizona Farm Bureau in collaboration with Arizona fruit and vegetable farmers to educate and inform consumers about the nutritious nature of Arizona’s top specialty crops by creating and disseminating a video series about Arizona’s ‘Top Ten’ specialty crops.”

You just heard about the next YouTube viral sensation before everyone else.

“Partner with the California Olive Oil Council to expand opportunities for California olive oil by executing a marketing campaign that focuses on two key high-end food markets: California and the region between the District of Columbia and New York City.”

You might wonder why you’re paying to help market expensive olive oil to affluent coastal residents.

Shut up, that’s why.

There are also a number of programs to help strawberry growers:

“Enhance the managerial skills and competitiveness of Virginia strawberry growers.”

“Partner with the Board of Regents of the University of Wisconsin System to develop a producer-led strawberry sustainability assessment program.”

“Partner with the University of Minnesota to provide information to Minnesota strawberry growers on new production methods using low tunnels.”

“Partner with the University of Nebraska – Lincoln to conduct a replicated experiment with four different strawberry cultivars including cultivars specifically developed for the short day photoperiods.”

“Partner with the North Carolina Strawberry Association to implement a two pronged campaign that will focus efforts to market the nutritional benefits of strawberries.”

Sadly, it will all be for naught as they are also proving funding to:

“...Position the Florida strawberry industry with a dominant quality advantage in the marketplace.”

Boy, are those other guys going to be ticked off.

“Partner with the Oregon Department of Agriculture and Seattle Wholesale Growers Market Cooperative to develop and deliver resources to train a minimum of industry stakeholders in methods for achieving high quality cut flower production.”

Do you have any idea what this country loses each year in low-quality cut flower production? We don’t either, but we bet it’s a lot.

“Partner with the California Avocado Society to improve the competitiveness and sustainability of California avocado producers through the creation of an agricultural outreach program that provides technical education for critical job skills.”

 Not many people realize this, but avocado jobs are the 137,865^th fastest growing occupation in the country.

 “Cooperate with the Oregon State Department of Agriculture to increase awareness of Northwest fresh and processed specialty crop products and build trade relationships between buyers and sellers—targeting importers, wholesalers, and retailers—in order to increase sales in three market areas in Southeast Asia.”

What about simply letting private businesses take on the task of marketing their own products and building trade relationships between buyers and sellers?

What are you? Some kind of extreme right-wing free-market absolutist?!

“Partner with the Arizona Nursery Association to expand the successful Plant Something promotion with the goal of increasing the sale and use of Arizona grown landscape plants and trees and to develop the campaign into a national nursery campaign.”

You know what, the “Plant something” program kind of sums up the general philosophical approach the Agriculture Department takes on handing out these grants, so we’ll just wrap it up here. Just keep in mind that:

“Since 2006, the program administered by USDA's Agricultural Marketing Service (AMS) has awarded $240 million.”

That’s not something we had to dig up through a FOIA request.

They’re proud of it!

J.

He Makes Money The Old Fashioned Way. He Prints it.

Yesterday, Federal Reserve Chairman Ben Bernanke used a presentation he had been scheduled to give to the Economic Club of Indiana as a platform to make a vigorous defense of his latest plans to engage in quantitative easing via the printing press.

As our readers are well aware, monetary policy and macroeconomics are very complex subjects, so we thought we’d go through the highlights of his speech to help you better understand it:

“Since 2008, we've used… less-traditional monetary policy tools to bring down longer-term rates. The first of these less-traditional tools involves the Fed purchasing longer-term securities on the open market--principally Treasury securities and mortgage-backed securities…”

Some tools are less traditional for a reason. Like when Alexander P. Broughton, a 20-year-old University of Tennessee student, used a “less traditional tool” to get drunk.  (You probably don’t want to click on that.)

“The securities that the Fed purchases in the conduct of monetary policy are held in our portfolio and earn interest. The great bulk of these interest earnings is sent to the Treasury, thereby helping reduce the government deficit. In the past three years, the Fed remitted $200 billion to the federal government.”

If you’re wondering why, if we can reduce the deficit by purchasing Treasury bills with fake money and turning the fake interest payments back in to Treasury, why don’t we just have the Fed purchase all the treasury bills, well, good news!

They’re getting there!

“I sometimes hear the complaint that the Federal Reserve is enabling bad fiscal policy by keeping interest rates very low and thereby making it cheaper for the federal government to borrow. I find this argument unpersuasive. The responsibility for fiscal policy lies squarely with the Administration and the Congress.”

Exactly. It would be like if someone blamed you for giving whiskey and car keys to a teenager.  The responsibility for not plowing into a crowd of young schoolchildren at a bus stop lies squarely with the teenager, not with you.

And keep in mind, the Fed’s actions are in no way political. In fact, in response to the suggestion that the Fed should stop interfering so aggressively in the markets and allow rates to rise, Mr. Bernanke said:

“Using monetary policy to try to influence the political debate on the budget would be highly inappropriate.”

Exactly. Were the Fed to cease intervening in markets and allow interest rates to float at normal levels so that prices could adjust and markets could go through the painful but efficient process of healing as market-clearing prices are established, it would clearly “influence the political debate” and be “highly inappropriate.”

In contrast, actively forcing on the markets historically unprecedented low interest rates and running the printing presses so as to purchase government bonds with the express purpose of inflating financial asset prices just one month before a presidential election regardless of the long-term consequences is 100% non-partisan straightforward policy making.

That is how you can tell Ben Bernanke is serious about maintaining the credibility of the Fed.

“[An important question] is whether the Federal Reserve's monetary policy will lead to higher inflation down the road. In response, I will start by pointing out that the Federal Reserve's price stability record is excellent, and we are fully committed to maintaining it.”

FUN FACT: The dollar has lost over 95% of its value since the creation of the Federal Reserve.

“With monetary policy being so accommodative now, though, it is not unreasonable to ask whether we are sowing the seeds of future inflation. A related question I sometimes hear--which bears also on the relationship between monetary and fiscal policy, is this: By buying securities, are you "monetizing the debt"--printing money for the government to use--and will that inevitably lead to higher inflation? No, that's not what is happening, and that will not happen.”

We don’t know about you, but we sure feel a lot better.

“Monetizing the debt means using money creation as a permanent source of financing for government spending.”

You see, “monetizing the debt” is when you print money forever, whereas Fed policy is to print money until the “appropriate time.”

And they won’t tell us when that appropriate time will be, only that it will depend on how much the economy strengthens.

And they won’t tell us how much the economy needs to strengthen first for them to stop printing money.

And even then, they will still continue to print money.

“The Committee expects that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the economic recovery strengthens.”

But other than that, it’s absolutely not “monetizing the debt.”

That would just be wrong.

J.

Obama Administration Match Game!

Carefully examine these three real-life situations currently in the news:

1) A government minister of one of our allies offers to pay for the assassination of an American citizen.

2) An artist dunks a the son of the Lord, Jesus Christ, in urine.

3) An amateurish video is posted on YouTube that is unflattering to the Prophet Mohammad.

Now, see if you can match each of those with one of the following official Obama Administration reactions:

A) "Inflammatory and inappropriate.”

B) "Offensive, disgusting, and reprehensible."

C) "No comment."

If you are like most Planet Moron readers, you're probably thinking, "Hey, you said no pop quizzes!"

Also, "Well, number 1 is easy. Clearly, offering to pay for the assassination of an American citizen would garner the most vociferous and full-throated objection."

Not quite.

As it turns out, the Obama administration found Pakistan Railway Minister Ghulam Ahmad Bilour's offer of $100,000 to kill filmmaker Sam Bacile to be only "inflammatory and inappropriate." (It will be interesting to see what the Administration's reaction will be if Bacile is actually assassinated.  Perhaps, they will view that as "unfortunate and ill-advised," or possibly "rude and discourteous.")

That still leaves two matches left.  While you might think that dunking a crucifix in urine might qualify as at least "disgusting" (if only because dunking anything in urine other than maybe a pregnancy strip is disgusting), the Obama Administration actually has no comment on that bit of religious agitation, perhaps fearful that bloodthirsty Christians will surround the Edward Tyler Nahem Gallery in Manhattan and demand that they be allowed to hand out leaflets in an overly aggressive manner.

No, the Obama Administration takes on the role of "Film-Critic-in-Chief, and saves their greatest objections for an amateurish YouTube video.

Okay, let's give you one more try. Which of these things doesn't belong with the others?

1) Targeting Coptic Christians.
2) Bullying women.
3) Stealing a country’s resources.
4) Slandering the prophet of Islam.

If you chose, "4" because all the others are acts of violence or theft while "slander" in this case is really just a matter of exercising free speech, sorry, you got that one wrong too.  It was a trick question.

They all belong together.

Better luck next time!

J.

Thanks to The Leadership of Comrade Obama, How Excellent This Water Tastes!

If you are like most Americans, you probably worry that you are insufficiently reverent of our Dear Leader, Barack Obama. No doubt, you rise each day thinking, “I’ve got the yard sign, I’ve got the bumper sticker, I’ve fasted, given away my wedding gifts and am selling my belongings to support His campaign, and yet it all seems so inadequate.”

Fortunately, the Obama presidential campaign has a number of items that will help you to at least begin to demonstrate, as best as can be achieved in this earthly realm, your fidelity to Him.

Take, for example, this poster, suitable for either simple framing or to serve as the focal point of your home’s Obama shrine:

You know, that look on his face. It seems familiar somehow.

Oh, yeah, that’s where we’ve seen it before.

You may also want to consider this modern update on an old and outdated classic:

It's enough to make us want to break out in verse:

I pledge allegiance,
To Obama,
And the People’s Republic of America,
And to the Collective,
For which He stands,
One nation,
Under Obama,
Insolvent,
With birth control,
And abortion,
For all.

Along those same lines, is this piece which we like to call, “The United States of Obama.”

We’re not campaign experts here, but we probably would not have chosen a motif that suggests that the country is awash in ever-higher levels of red ink.

And then there’s this.

Clearly, nothing says “I support Barack Obama” better than… whatever it is this is supposed to be. (NOTE: Planet Moron commenter "Michael" might have figured it out: "If you pronounce it out loud it does proclaim 'we owe!', so at least they have candor going for them.")

And finally, the Obama campaign has a special section for all your most popular ethnicities to pay their proper respects, including African Americans, Jewish Americans, Latino/Hispanic Americans, and:

Which, we’ll be honest, kind of sounds like “Etc., for Obama.”

But if you really want to go that extra devotional step, The Obama campaign hopes you will consider something a little more personal.  Like defiling your body:

“There’s a new way to show that you’re voting for someone who represents us all. Choose one of your reasons for voting and write it on your hand, then pledge to vote. You can share a photo on Twitter and Instagram with #ForAll. Check out some of the photos—you might even recognize a few of the faces.”

Because when we think of a democratic process in which sovereign citizens gather to choose civil servants who will carry out the administrative functions of government, we think, “Hey, as a demonstration of our allegiance, let’s desecrate our flesh and then post the results on the Internet.”

Like this guy.

And these two.

Okay, we'll stop now.

J.

OUT: “Helicopter Ben” IN: “747 Ben”

If you were faced with a lackluster recovery following the bursting of a massive real estate bubble in which housing prices had been artificially inflated through government action, what would you do?

1. To ensure that such an artificial real estate bubble never occurs again, take aggressive measures that would allow interest rates and real estate prices to adjust to their natural levels according to the laws of supply an demand and in so doing stabilize the economy, eliminate malinvestment and the misallocation of capital, and set the stage for stable, long-term growth.
2. Create another artificial real estate bubble.

If you said, “Create another artificial real estate bubble,” you just might have what it takes to be the Chairman of the Federal Reserve!

While you might have missed it last week, given the media’s understandable focus on the despicable attacks made on Muslim sensibilities by a filmmaker/free speech terrorist, Federal Reserve Chairman Ben Bernanke announced a new round of “Quantitative Easing” known as, “QE3.”

No doubt, you have a lot of questions regarding this development, so we created the following FAQ:

Q: What, exactly, is “Quantitative Easing?”
A: It’s really very complicated, you probably wouldn’t understand.

Q: It can’t be that complicated.
A: Oh, yes, it’s all very complex involving advanced monetary theory, macroeconomics, and market equilibriums.

Q: Humor us. What is quantitative easing?
A: It’s printing up new money.

Q: Quantitative easing is just Ben Bernanke printing up new money?  What’s it called if we were to do that?
A: Counterfeiting.

Q: How is it different?
A: If you were to print up new money, you’d just go out and buy stuff.

Q: And if the Fed prints up new money?
A: They’ll use it to purchase financial assets thus driving down nominal long-term interest rates which will lead to lower mortgage rates, and thus higher home prices.

Q: Why do they want to do that?
A: So you’ll go out and buy stuff.

Q: Well, if they’re just going to print up new money and debase the currency, why not cut out the middleman and just give it to us directly so we can buy stuff?
A: Hey, someone has to buy all the debt the federal government is issuing!

Q: Okay, so why call it “QE3?”
A: Because there was already a “QE1” and a “QE2.”

Q: If they have to try it for a third time, it kind of suggests it doesn’t work, right?
A: No, not at all. It’s like if your car won’t start, and you decide that maybe you’ve run out of gas, so you add more gasoline. And when that doesn’t work, you add some more. And if that doesn’t work, well, it’s obvious what you do then, right?

Q: Check to see if the starter is bad instead?
A: No!  You add more gas.  And you keep adding gas until it’s spilling all over the floor.

Q: And what happens if you actually get the car to start?
A: Um….

Q: Okay, to sum up, Ben Bernanke wants to artificially create higher real estate prices using a mechanism that has already failed twice before even though it risks debasing the currency, creating inflation, and causing the same financial crisis we already had all over again.  Why is that a good idea?
A: Because everyone else is doing it, too!

J.