The fed

Discussion in 'Bullion Investing' started by longnine009, Aug 18, 2015.

  1. longnine009

    longnine009 Darwin has to eat too. Supporter

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  3. Brett_in_Sacto

    Brett_in_Sacto Well-Known Member

    This will quickly turn into a political discussion. In simple terms QE has been nothing but a giant initiative to perfume the pig.

    I feel sorry for Queen Elizabeth having to endure the reference.
     
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  4. longnine009

    longnine009 Darwin has to eat too. Supporter

    Mum has endured much worse. The Sex Pistols used to follow the Royal yacht on the Thames in the 70's with Johnny Rotten blasting her with a bull horn.
     
    Last edited: Aug 18, 2015
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  5. medoraman

    medoraman Supporter! Supporter

    Eh, a VP of a regional Fed branch. Is it fair that any single one of us post something and the media would pick it up as "The website CoinTalk says...". I have heard a wide variety of opinions from certain Fed officials over the years that had nothing to do with official Fed policy, just like there are a variety of opinions here on issues.

    Do I think zero interest rate policy has been a trajedy to the elder population in this country? Of course, I just don't know if the Fed fully realizes that yet.
     
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  6. mikem2000

    mikem2000 Lost Cause

    I am not exactly sure I am getting your point. Sure if these folks had their money in the, bank, they got no growth, but inflation was near zero so it is a wash. They could also buy cars, houses ect, with VERY low interest rates, saving a buttload. Also, many elderly actually do understand how to manage their money with a balanced portfolio and made out very well. IMHO, the biggest problem the elderly have is soaring health costs. That is a killer, and a tough issue to solve.
     
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  7. autograf

    autograf Member

    Let's face it......QE pumping into the stock and bonds market at ~$85B/mo benefitted one group of people......ultimately, it benefitted the rich the most and grew the disparity between rich & poor that the current regime likes to talk about has gotten so bad. A self-fulfilling prophecy. It helped some of us build our 401K portfolios back as well but when things drop again, we'll see. Rates have to go up SOMETIME. I thought dropping QE would affect the market more but it didn't. Maybe increasing rates won't hurt the market as bad either. We shall see.
     
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  8. longnine009

    longnine009 Darwin has to eat too. Supporter

    Is there something wrong with CNBC?
     
    Last edited: Aug 18, 2015
  9. Collecting Nut

    Collecting Nut Borderline Hoarder

    I'm biting my tongue on this one.
     
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  10. mikem2000

    mikem2000 Lost Cause

    Well, nearly half of all Americans have some exposure to equities, so I think it benefited many more than just the rich. Even the 52% of the folks who choose not to participate, have benefited greatly also. QE and 0 interest rates just didn't raise the equity prices like magic. What it did was make it easier for companies to turn a profit. When their profits increased, the stock price JUSTIFIABLY went up. If profits were not increased, the stock market would not have moved higher. So these companies that were now more profitable were able to lay off much fewer workers, were able to hire more folks, cut less benefits, give raises, buy more "Stuff " from other folks, etc, etc. All of this benefited many folks, who don't own a single share.

    Also, participation in the stock market is not by invitation only. It is open to everyone. If you have enough money to open a savings account, you have enough to invest in equities. So the 52% of the folks not invested in equities, is strictly their choice.
     
  11. mikem2000

    mikem2000 Lost Cause

    Nope, there is something wrong with the folks who WATCH CNBC ;)
     
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  12. medoraman

    medoraman Supporter! Supporter

    Someone spends their life to build up a nest egg to live on, then the Fed lowers interest rates to almost zero. I do not care how low inflation goes, how are you supposed to live on zero interest? Lowering interest rates to near zero is a huge boon for borrowers, and hugely punitive to savers. It rewards the grasshoppers at the expense of the ants.
     
  13. longnine009

    longnine009 Darwin has to eat too. Supporter

    Who should they be watching?
     
  14. ToughCOINS

    ToughCOINS Dealer Member Moderator


    That money chiefly benefitted the Banking industry because banks were unable or unwilling to lend the money because of restrictions on unacceptable risk. Therefore, they had little else to do but take that sidelined money and put it in other vehicles, from which they profited handsomely because of the extremely low cost of borrowing. I don't think it was anyone's intent that banks benefit in this manner. No, I just think it's just another case of unintended consequences.
     
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  15. Evan8

    Evan8 A Little Off Center

    Odd how everytime the government gets involved in something, it gets screwed up. Hmm, i wonder why that is...
     
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  16. statequarterguy

    statequarterguy Love Pucks

    It gets screwed up for the people. The government has been taken over completely by the wealthy/corporations, so nothing gets screwed up for them, they always benefit. When one party says they care about the people, they're talking about the wealthy and corporations, which are people per the corrupt supreme court.
     
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  17. Evan8

    Evan8 A Little Off Center

    Oh boy shoulda just kept my mouth shut. Well its been nice, but Im gonna go see some people's newest acquisitions before i get into trouble. Again.
     
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  18. Gilbert

    Gilbert Part time collector Supporter

    Many elderly do not trust the stock market, myself included. I got burned in the meltdown of 2008-09. And yes, this latest Fed-inspired asset bubble has benefitted many, including those with 401's and IRA's tied to the market. But as we age we get more careful with our money because the option of working to start over is not viable. IMO the FED lowered interest rates to help out their owners PERIOD. They do not care about those elderly who saved via banks and credit unions so they could have a respectable retirement.
     
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  19. SD51555

    SD51555 Active Member

    The ones that were holding bonds when it went to crap made out like bandits. Cash, not so much. I'm in the camp that QE hasn't done anything for the economy. Consider there hasn't been any real economic growth since the 90's. Everything post 2000 has been pump and blow. Now it's pump and refuse to acknowledge.

    The national infrastructure deficit was/is 3-4 trillion dollars. We borrowed 10 under PBO and it's still falling apart.
     
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  20. mikem2000

    mikem2000 Lost Cause

    I see the point of it being a boon for borrowers, as the elderly do less borrowing, so the don't receive that bene to the same degree, but generally, when interest rates are higher, so is inflation. If you are getting 4% on your money but inflation is 6% what is the difference? Anyone who keeps all their money in a bank account long term, is going to take a beating regardless of interest rates. It is just not a good thing to do, elderly or not.

    This may be the conservative coming out of me, but folks need to be responsible for themselves. They need to have a basic understanding of finances. I really don't think it is the GOV's business to protect people from themselves, only make sure opportunity exists. It has been proven a balanced portfolio is still the best way to go, even for folks in their 80's. So if the elderly (or anyone) doesn't like 0%, they should do something about it. I am also of the opinion that the majority of the elderly do have the capability of understanding these basic concepts, and if they can't, family members can assist.
     
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  21. mikem2000

    mikem2000 Lost Cause

    Reruns of Gilligan's island of course. I really like that episode where Gilligan ruins the Professors plan to get off the island. That was a good one ;)
     
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