• 4 hours Italy’s Central Bank Embraces Sustainable Investing
  • 7 hours Trump Lifts Metals Tariffs To Cool Simmering Trade War
  • 10 hours Researchers Push To Limit Space Mining
  • 12 hours Could China Start Dumping U.S. Treasury Bonds?
  • 1 day Is Winter Coming For HBO?
  • 1 day Rise Of EVs Signals Peak Gasoline
  • 2 days Jeff Bezos Doubles Down On Space Colonization Ambitions
  • 2 days Gold Mining Stocks Stuck In Limbo
  • 3 days Executive Order Targets Huawei Over Espionage
  • 3 days Why Now May Be The Best Time Ever To Hold Gold
  • 4 days Fake News Sinks Shares In UK-Based Bank
  • 4 days De Beers To Build $468 Million Diamond Recovery Ship
  • 4 days Moody's: Turkey Faces Possible Credit Downgrade
  • 5 days Tesla's Solar Sales Are Slipping
  • 5 days Auto Industry To Get Temporary Tariff Relief
  • 5 days Welcome To The World’s Biggest Free Trade Area
  • 5 days Central Banks Are Stockpiling Gold At The Fastest Rate In Half A Decade
  • 6 days U.S.-China Impasse Threatens Rare Earth Trade
  • 6 days Wall Street Bears $1 Trillion Brunt Of Trade War
  • 6 days Mobile Sports Betting Isn’t Quite Minting Millionaires Just Yet
Strong U.S. Dollar Weighs On Blue Chip Earnings

Strong U.S. Dollar Weighs On Blue Chip Earnings

Earnings season is well underway,…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

  1. Home
  2. Markets
  3. Other

Yellen Asks Congress for Pro-Growth Policies, Ducks Question on Taxes

Outgoing Fed Chair Janet Yellen Received a Warm Reception at what will be her last appearance before Congress at the Fed's semiannual report to Congress on monetary policy.

In her testimony on Current Economic Outlook and Monetary Policy, Yellen expressed concerns about slow growth, inflation, and wages.

More Transitory Nonsense

Yellen repeated her message that "recent lower readings on inflation likely reflect transitory factors."

Her definition of recent must mean five years because that is how long the Fed has undershot its goal, not that the goal makes any sense whatsoever.

Yellen Ducks Question on Corporate Taxes

Republican Rep. Pat Tiberi asked about corporate taxes. Yellen ducked the question.

 

Pro-Growth Policies

"To generate a sustained boost in economic growth without causing inflation that is too high, we will need to address these underlying causes. In this regard, the Congress might consider policies that encourage business investment and capital formation, improve the nation's infrastructure, raise the quality of our educational system, and support innovation and the adoption of new technologies," said Yellen.

Underlying Cause of Slow Growth

Yellen needs to look into a mirror to see a key underlying cause of slow growth: "The Fed".

The Fed's group-think micromanagement of interest rates while ignoring asset bubbles coupled with excessive Congressional spending on worse than useless military meddling are two key problems that neither the Fed nor Congress sees.

Economic Challenge to Keynesians

 

Of all the widely believed but patently false economic beliefs is the absurd notion that falling consumer prices are bad for the economy and something must be done about them.

The BIS did a study on deflation and concluded "Deflation may actually boost output. Lower prices increase real incomes and wealth. And they may also make export goods more competitive."

In their attempts to fight routine consumer price deflation, central bankers create very destructive asset bubbles that eventually collapse, setting off what they should fear – asset bubble deflations following a buildup of bank credit on inflated assets.

By Mike Shedlock

Back to homepage

Leave a comment

Leave a comment