• 618 days Will The ECB Continue To Hike Rates?
  • 619 days Forbes: Aramco Remains Largest Company In The Middle East
  • 620 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,020 days Could Crypto Overtake Traditional Investment?
  • 1,025 days Americans Still Quitting Jobs At Record Pace
  • 1,027 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,030 days Is The Dollar Too Strong?
  • 1,030 days Big Tech Disappoints Investors on Earnings Calls
  • 1,031 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,033 days China Is Quietly Trying To Distance Itself From Russia
  • 1,033 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,037 days Crypto Investors Won Big In 2021
  • 1,037 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,038 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,040 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,041 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,044 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,045 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,045 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,047 days Are NFTs About To Take Over Gaming?
Lending: The Good, Bad, And Ugly

Lending: The Good, Bad, And Ugly

Aristotle said, “The most hated…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

  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