In A Box

The Federal Reserve and its new chairman Mr. Ben Bernanke are in a box. By this I mean there are opposing issues that prevent them from taking action that will solve their problem.

Consider this report:

This is indicative of a slowing of the economy. In order to stimulate the housing market, the Fed would have to reduce interest rates to make the purchase of new homes more attractive.

The catch is that a reduction in interest rates will make investment in U.S. treasury debt by foreigners less attractive and they will look elsewhere to invest their dollars. If we don't continue to receive the billions of dollars daily from foreigners that finance the U.S. debt, the shortfall will have to be filled by the printing of dollars. This will inevitably lead to more inflation. If foreign investors perceive an inflationary trend in the U.S. they will back off on their investment of U.S. debt. which will fuel a cycle of less investment in the U.S.

Here's another report report that indicates that many existing home owners may already be under water regarding their mortgage and that many individuals are in for some real financial pain.

Given the above, I can only wonder what contribution these people are going to be able to make to the economy in terms of spending. The answer is, most likely, not much. And if that's the case, a recession or worse is likely.

Understanding the current state of affairs, it is easy to see why the Federal Reserve has discontinued publishing the M3 money supply figure as of yesterday. It will make it difficult if not impossible for analysts to determine our true rate of inflation but even so, the results will surely become apparent to the casual observer in short order.

There's no doubt that the money supply is going to go to the moon. I may have been mistaken in my suspicion that the reason for the discontinuance of M3 reporting was specifically because of Iran's intent to establish the oil bourse selling oil for euros but it hardly matters. It appears that several months ago when the Fed announced it would discontinue the report they could see that they would have to flood the economy with dollars (and try to hide the fact) either because of Iran's intentions or because of the news linked above, or for other reasons that we don't know of yet but it hardly matters what the cause is. The fact of the matter is that we are where we are and consequently, it looks like the Fed will be pressured to print enormous amounts of dollars.

Got gold?

Bias? What Bias?

More light is shed on why people are tuning out the MSM:

A top producer at ABC News declared "Bush makes me sick" in an email obtained by the Drudge Report.

John Green, currently executive producer of the weekend edition of Good Morning America, unloaded on the president in an ABC company email obtained by the Drudge Report.

"If he uses the 'mixed messages' line one more time, I'm going to puke," Green complained.

The blunt comments by Green, along with other emails obtained by the Drudge Report, further reveal the inner workings of the nation's news outlets.

A friend of Green's at ABC says Green is mortified by the email. "John feels so badly about this email. He is a straight shooter and great producer who is always fair. That said, he deeply regrets the sentiment expressed in the email and the embarrassment it causes ABC News."

We're sure that Mr. Green, his embarrassment notwithstanding, was boffo in network newsrooms around the country for expressing these bold and courageous sentiments about the evil Mr. Bush. He'll probably get a raise.

The Baghdad Documents

ABC News has examined several documents captured in Baghdad after the invasion and finds evidence that:

1. The Russian ambassador who was also implicated in the oil-for-food scam was relaying military information to Saddam about the composition, deployment, and strategy of American forces. He apparently had a source in American Central Command at Doha, Qatar.

2. There was contact between Osama Bin Laden, the Taliban and Iraqi officials concerning the possibility of concerted action against American forces in Saudi Arabia in the mid-nineties as well as possible strikes on American soil.

Of course, the Bush administration has maintained this second point all along, if rather irresolutely, and for their pains they've been made sport of by the lefty media and the Democrats. The argument, however, has been swinging back in the administration's favor for some time now, and the set of plausible criticisms of the White House's decision to go to war continues to shrink.

Saint Fidel

In the left's pantheon of saints few rank higher than Fidel Castro. Thus when Delf�n Fern�ndez, a former member of Castro's inner circle, starts telling tales, it's as distressing to the left as unflattering cartoons of the prophet (PBUH) are to Muslims. Here's some of what Fernandez says in the Miami Herald:

"The initial idea of Fidel was good. Batista was an assassin," Fern�ndez said. "What happened was, the course he took with the revolution was wrong. It has dissolved into this unstoppable, insatiable corruption without limits, a vast lie. The people are in misery. Cuba's people have been enslaved as cheap labor for foreign businessmen."

Fidel Castro turns 80 this year, and he has become obsessed with his health, Fern�ndez said. The Castro brothers each have their own clinics and their own doctors in Havana's Council of State Building and in the Cimeq Hospital. Last year, Fidel Castro built a multimillion-dollar clinic a few yards from his front door, on the grounds of his Havana estate, Fern�ndez said he learned from his island contacts.

Fern�ndez said he carried suitcases with cash out of Cuba for the Castro brothers. Fern�ndez's photographs include several of him with the children of Fidel and Ra�l at one of their beachfront estates and with many high-profile Spanish businessmen.

"Cuba has a death sentence against me for high treason."

No wonder. He may as well have called the Pope an adulterer as to point out that Fidel lives like a filthy rich capitalist pig. I wonder how many of the proles languishing in the Havana barrios have their very own multi-million dollar clinic. Apparently, Cuba's revolution simply replaced one borgeoisie class with another. So much for Karl Marx's vision of social equality, in Cuba, or anywhere else, for that matter, where communists have held power.