[VonErmad4]

Sheila Bair's Modest Proposal To Fix Everything: Hyperinflation



Submitted by Tyler Durden on 04/15/2012 11:49 -0400



This one is actually quite funny, although we feel that the MMTers, the Neo-Keynesians, the Econ 101 textbook fanatics, and the government apparatchiks out there will fail to appreciate the humor. However, we are a little concerned how many of those in charge read into this a little too much, and decide to make this official policy...

From the Washington Post:

Fix income inequality with $10 million loans for everyone!

By Sheila Bair, Published: April 13

Are you concerned about growing income inequality in America? Are you resentful of all that wealth concentrated in the 1 percent? I’ve got the perfect solution, a modest proposal that involves just a small adjustment in the Federal Reserve’s easy monetary policy. Best of all, it will mean that none of us have to work for a living anymore.

For several years now, the Fed has been making money available to the financial sector at near-zero interest rates. Big banks and hedge funds, among others, have taken this cheap money and invested it in securities with high yields. This type of profit-making, called the “carry trade,” has been enormously profitable for them.
So why not let everyone participate?

Under my plan, each American household could borrow $10 million from the Fed at zero interest. The more conservative among us can take that money and buy 10-year Treasury bonds. At the current 2 percent annual interest rate, we can pocket a nice $200,000 a year to live on. The more adventuresome can buy 10-year Greek debt at 21 percent, for an annual income of $2.1 million. Or if Greece is a little too risky for you, go with Portugal, at about 12 percent, or $1.2 million dollars a year. (No sense in getting greedy.)

Think of what we can do with all that money. We can pay off our underwater mortgages and replenish our retirement accounts without spending one day schlepping into the office. With a few quick keystrokes, we’ll be golden for the next 10 years.

Of course, we will have to persuade Congress to pass a law authorizing all this Fed lending, but that shouldn’t be hard. Congress is really good at spending money, so long as lawmakers don’t have to come up with a way to pay for it. Just look at the way the Democrats agreed to extend the Bush tax cuts if the Republicans agreed to cut Social Security taxes and extend unemployment benefits. Who says bipartisanship is dead?

And while that deal blew bigger holes in the deficit, my proposal won’t cost taxpayers anything because the Fed is just going to print the money. All we need is about $1,200 trillion, or $10 million for 120 million households. We will all cross our hearts and promise to pay the money back in full after 10 years so the Fed won’t lose any dough. It can hold our Portuguese debt as collateral just to make sure.

Because we will be making money in basically the same way as hedge fund managers, we should have to pay only 15 percent in taxes, just like they do. And since we will be earning money through investments, not work, we won’t have to pay Social Security taxes or Medicare premiums. That means no more money will go into these programs, but so what? No one will need them anymore, with all the cash we’ll be raking in thanks to our cheap loans from the Fed.

Come to think of it, by getting rid of work, we can eliminate a lot of government programs. For instance, who needs unemployment benefits and job retraining when everyone has joined the investor class? And forget the trade deficit. Heck, we want those foreign workers to keep providing us with goods and services.

We can stop worrying about education, too. Who needs to understand the value of pi or the history of civilization when all you have to do to make a living is order up a few trades? Let the kids stay home with us. They can play video games while we pop bonbons and watch the soaps and talk shows. The liberals will love this plan because it reduces income inequality; the conservatives will love it because it promotes family time.

I’m really excited! This is the best American financial innovation since liar loans and pick-a-payment mortgages. I can’t wait to get my super PAC started to help candidates who support this important cause. I think I will call my proposal the “Get Rid of Employment and Education Directive.”

Some may worry about inflation and long-term stability under my proposal. I say they lack faith in our country. So what if it cost 50 billion marks to mail a letter when the German central bank tried printing money to pay idle workers in 1923?

That couldn’t happen here. This is America. Why should hedge funds and big financial institutions get all the goodies?


Look out 1 percent, here we come.

[Cuccuccaltefe]

WTF! I realize that this most likely was an attempt at satire. But what the hell was her aim with it? And why on earth would Washington Post publish something as inane as this?

[softy54534]

Because we live in a cartoon... why take any of it seriously?

[DraidodaRip]

WTF! I realize that this most likely was an attempt at satire. But what the hell was her aim with it? And why on earth would Washington Post publish something as inane as this?

Most likely an attempt at satire? It is total fucking satire and it brilliantly shows the insanity of our current financial model.

[VonErmad4]

WTF! I realize that this most likely was an attempt at satire. But what the hell was her aim with it? And why on earth would Washington Post publish something as inane as this?

Never underestimate the insanity and hubris of the sociopath in a position of power. Someone in her position, if she had any humility and self-respect, would be loathe to have such a screed published with her name attached to it, lest she reveal that such nihilistic ideas have even crossed her mind, satire or not. A respected physician would not publish a satire about human experimentation and torture and tarnish his image, if he were honorable.

[ahagotyou]

Someone needs to stab her in the taint.

Hey, just saying.

[soryalomop]

Dude I am like still slack jawed that this is not some sort of crude joke.

We are truly at the cusp of the event horizion.

My friends .....Steele yourself and pray to whatever God you believe in.......cause Sh!t is gonna get bad.....real bad.

[TeapseTic]

I agree. It is brilliant!

Funny, I thought the same thing after reading it. Brilliant indeed.

[Opislossy]

She forgot to mention that the taxes collected from this money would almost instantly pay off the national debt.

[OwdBKKHO]

Dude I am like still slack jawed that this is not some sort of crude joke.

We are truly at the cusp of the event horizion.

My friends .....Steele yourself and pray to whatever God you believe in.......cause Sh!t is gonna get bad.....real bad.

Twist, I always come away feeling the same way after reading any of your posts.

On the one hand, you are always absolutley spot on. I mean that brother,i really do.

However, here is the thing that always gets me. Ive been reading your posts for over 5 fu*king years, and even though they are always as i said "spot on " nothing ever seems to materialize . Im beggining to think that we are the suckers Twist. I mean come on brother, FIVE YEARS IS A LONG FU*KING TIME in a linear life span. We aint getting any younger. All the sheep that we excoriate here on a daily basis may be oblivious, but maybe thats not such a bad thing.

Life is for living, and the sheep have spent the last 5 years living, right along side the wall street crooks who never even once thought about not living the high life.

What say you Twist ?

[avdddcxnelkaxz]

I’m really excited! This is the best American financial innovation since liar loans and pick-a-payment mortgages. I can’t wait to get my super PAC started to help candidates who support this important cause. I think I will call my proposal the “Get Rid of Employment and Education Directive.”
= GREED

everybody caught this didn't they?

[DraidodaRip]

Dude I am like still slack jawed that this is not some sort of crude joke.

We are truly at the cusp of the event horizion.

My friends .....Steele yourself and pray to whatever God you believe in.......cause Sh!t is gonna get bad.....real bad.

Dude...it's a total joke. It's called satire. You should read about the history of a "modest proposal" by Jonothan Swift.

That isn't to say we won't get hyperinflation, but she certainly is not an advocate of it.

[soryalomop]

I remember the days when I was hardcore MEGA DOOM

I literally thought we were a mere few days away from getting the bombs dropped on us. looking back that paranoia was a outgrowth of the reality that I was woefully underprepared..so I literally tried to go full bore but actually made very little traction. a lot of that came from situations that were outside of my control : (destructive sociopathic ex spouse, rental house became a albatross, employment literally dried up, trying to wake up others when I myself was still drowning ...just a tad bit slower.)

Hind sight is always 20/20 but you never get a do over .......just a hope that you can better play the cards you are dealt tommarow.

Im still in a very vunerable state right now....but things are looking promising once I get a few more stars to align.I long for the days when I can ease up but when your in the thick of it.....its hard to see or think about anything else but the edge that you might go over with the wrong misstep.

I have gotten a bit better I try to.make sure my kids days are happy ones and for the most part their days are full of laughter. it helps me to take a more postive spin on things I tend to say to myself if the world wasn't going to be a better place God would have never blessed me with the Wee Ones.


I guess I'm.a work in progress and if I did have it I would spend a good chunk of time building the best memories cause when you think about it...your life will boil down to a couple of key moments...so I responsibilty is on you to make sure that those key moments are happy ones.

Taint easy but I'm working on it.

[OwdBKKHO]

Most excellent post Mr Titan. Thanks for that. I remember when you were going thru all that crap with the soon to be X like it was yesterday. Must be at least 4 years ago or more.

[serius_06]

She has a surprisingly good understanding of the way things work.

[Oberjej]

She has a surprisingly good understanding of the way things work.

As the FDIC chairperson during the collapse, I'm sure her hands aren't squeaky clean.

[crumoursegemo]

So when is Shelia's last day on the job?

[Cuccuccaltefe]

So when is Shelia's last day on the job?

In the words after the article it stated that she is the former FDIC head....I didn't know this before either.

[crumoursegemo]

In the words after the article it stated that she is the former FDIC head....I didn't know this before either.

I didn't remember. I thought she was done with the job later this year. I guess it was last year.

From her zio-pedia page.
Bair began her career in the General Counsel's office of the former US Department of Health, Education and Welfare.[6] Ms. Bair left the FDIC on July 8, 2011, when her five year term expired.[7]