Ron Paul – Vs Bernanke – Is Gold Money?
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[Ron Paul – Vs Bernanke – Is Gold Money?]
At this time we recognize Mr. Paul the sub-committee chair for 5 minutes.
[Ronald Ernest “Ron” Paul (born August 20, 1935] Source: LYBIO.net
Thank you (clears throat) thank you Mr. Chairman, you know we, we hear that in the future we are going to have a better economy and everybody hopes so but, its’ it’s hard to believe, it’s hard to – it’s hard for me to believe anyway. Because I look back at our past 3 years and what Congress has done what the Fed has done we literally injected ah, about 5.3 trillion dollars and I don’t think we got very much for it. The national debt went up $5.1 trillion dollars. Real GDP grew less than 1%. So I don’t think we’ve gotten a whole lot. Unemployment hasn’t really recovered.
We still have 7 million people that have become unemployed. And one statistic that is very glaring if you look at the chart is how long people are unemployed. The average time used to be 17 weeks, now it’s nearly 40 weeks they stay unemployed. So nothing there reassures me. And also, ah, when we talk about prices, we’re always reassured there’s not that much inflation and ah, and we’re told that they might start calculating inflation differently with a new CPI of course we changed our CPI a few year back there is still a free-market group that calculates the CPI the old fashioned way and they come up with a figure â€“ in spite of all this weak economy â€“ that prices have gone up 35%, 9.4% every year. And I think, if you just went out and talked to the average housewife, she’d probably believe the 9% rather than saying its only 2%. So I would say what we’ve been doing isn’t very reassuring with all this money expenditure but my question is related to the overall policy. LYBIO.net Spending all this money hasn’t helped. and yet may allies that would endorse so much of what’s been going on, whether it’s the Fed or the Congress, they recognize that consumers spending is very very important. And I concentrate on that. But the 5.1 trillion dollars, didn’t go to the consumers, it went to buying bad assets, it went to bailing out banks, it went to bailing out big companies, and low and behold, the consumer didn’t end up getting this, they lost their job and lost their houses, mortgages and they’re still in trouble. But my question is: If you took the 5.1 trillion dollars and said that consumer spending is good, you could of given every single person in this country 17,000 dollars. Why! Why, is it that Program both the Congress and the Fed to direct the money to the people who have been making a lot of money instead to the people, if you argue, that the consumer needs to spend the money, I obviously don’t advocate this, I would suggest maybe it could of worked better, could of worked any worse, but but what is the reason we directed toward the banks and the big corporations too big to fail and we don’t pay that much attention to the consumer, if it’s true, and I don’t know if you agree with that or not, that consumer spending is an important issue.
[Ben Shalom Bernanke (born December 13, 1953)] Source: LYBIO.net
Well it is an important issue Congressman, but you are mistaken in saying that the Federal Reserve has spent any money…hmm…you say $5 trillion. We have lent money, we have purchased securities…that’s not buying…that’s not dissipating…you know the money, we’ve gotten all of the money back. As an article over the weekend, by Allan Sloan, shown that the FED in fact has been a major profit center for the US government. LYBIO.net We’ve turned over profits, in the last two years of 125 billion dollars, so we are not costing any money in terms of budget deficits or anything like that, In terms of what we were trying to do of course – the one- the reason why the federal reserve founded a century ago was to try to address the problems arising from financial panics, which did by the way occur in an unregulated environment in the 19th century, we provided liquidity and short term loans to help financial systems stabilize – we did that – not because we particularly care about the managers or share holders of financial firms.
I – I hate to interrupt but my time is about out, I would like to suggest that you say its not spending money well it’s money out of thin air, when you put it into the market, you hold assets, and assets aren’t – you know – they are diminishing in value when you buy bad assets, but very quickly if you could answer another question because I’m curious about this, you know the price of gold today, is $1,580.00 dollars, the dollar during these last 3 years was devalued almost %15 , when you wake up in the morning, do you care about Price of gold?
Well I pay attention to the price of gold but I think it reflects a lot of things – it reflect global uncertainties – I think people are – the reason people hold gold is the protection, of what we call Tail risk, really, really bad outcomes and to the extent of the last few years made people more worried about the potential of a major crisis – then they have gold as a protection.
[Ron Paul] Source: LYBIO.net
Do you think – do you think gold is money?
[pause] No, its a precious metal.
It’s not money, even if its been money for 6,000 years , somebody reverse that, eliminated that economic law (smiles)
Well, well it’s an asset. It’s the same, would you say the treasury bills money? I don’t think they’re money., either, but they are a financial asset.
Why do – why do central banks hold it?â€
[Ben Bernanke] Source: LYBIO.net
Well it’s a form of reserves.
Why don’t they hold diamonds?
Well, it’s tradition, long term tradition.
Some people still think it’s money, I yield back my time is up.
[Speaker] Source: LYBIO.net
Ron Paul – Vs Bernanke – Is Gold Money? [Ron Paul]: Do you think – do you think gold is money? [Ben Bernanke]: [pause] No, its a precious metal. [Ron Paul]: It’s not money, even if its been money for 6,000 years , somebody reverse that, eliminated that economic law (smiles) Complete Full Transcript, Dialogue, Remarks, Saying, Quotes, Words And Text.