Last night, I tweeted: "How much fun will tom b if we get +150k NFP? Bernanke will hav lots o' fun appearing b4 House Banking Ron Paul 2 explain QE2."
Well, we got 159k+ and here’s what U.S. Rep. Ron Paul said yesterday:
- U.S. REP. RON PAUL, IN LINE TO HEAD HOUSE SUBCOMMITTEE ON MONETARY POLICY, SAYS WILL PUSH TO EXAMINE FEDERAL RESERVE MONETARY POLICY DECISIONS
- FEDERAL RESERVE IS 'WAY TOO INDEPENDENT', 'TOTALLY OUT OF CONTROL' - PAUL
- PAUL SAYS SUBCOMMITEE WILL PUSH TO AUDIT U.S. GOLD RESERVES
- PAUL SAYS DOES NOT BELIEVE DOLLAR CAN BE RESERVE STANDARD OF THE WORLD
- PAUL SAYS FED'S QUANTITATIVE EASING DECISION IS 'OUTRAGE,' 'REPRESENTS CENTRAL ECONOMIC PLANNING AT ITS WORST'
- PAUL SAYS WOULD TRY TO SHOW THAT FREE MARKET BETTER THAN BUREACRATS AT SETTING INTEREST RATES, MONEY SUPPLY
- PAUL SAYS COMMITTEE WILL PROMOTE VIEW THAT RECESSIONS ARE DUE TO BAD MONETARY POLICY, NOT BUSINESS CYCLE
The ISM employment numbers and the ADP numbers were all pointing up and to a strong NFP. Unlike taking the punch bowl away as the economic party gets going, the Fed appears to be spiking it.
This morning On CNBC, Moody’s Mark Zandi stated that the economy needs +150k just to keep the unemployment rate steady at 9.6%. We need +200k to have it decline. Here’s where I disagree with mainstream economists, I don’t believe (neither does Martin Feldstein) that the risks are worth the reward on QE2. The nightmare scenario for the Fed and the US middle income earners is unemployment at 8.9% and inflation at 4% and climbing.
Remember, Federal Reserve chairman Ben Bernanke stated in August at the Jackson Hole conference that there are limits to monetary policy.
When will the Fed turn to Congress and the White House and say, "We’ve done all that we can. It’s time for you to engage in policies that encourage growth."