TruthSavvy.

Americans have been reminded of at least two things of late: In the end, deflation is significantly about jobs. Secondly, and also according to Ben Bernanke, while we wait for the jobs we must realize that “central bankers alone cannot solve the world’s economic problems.” These may be the most important words Bernanke has uttered during his tenure as Fed chief.

A contradictory investment climate exists because the Fed bombed Wall Street with money. Hedge funds and investment banks don’t care that short-term Treasuries pay next to nothing. They buy Treasuries as collateral in up-leveraging speculative plays, especially in commodities. Wall Street elites expect to recoup the losses of 2008 as well as to grasp massive new profits, even if major indexes top out well short of their former highs later this year or next year.

In 2009 the leading issue of moral hazard was “too big to fail.” Not surprisingly, the more things change, the more they stay the same. As the congressional bank hearings of 2010 unfold, the new touchstone of moral hazard is “too big to discipline.” The heads of Morgan Stanley, J.P Morgan and Bank of America argue that they cannot be reproved in practice or disciplined by being broken up because their gargantuan size is necessary for the health of American banking in a global environment. ‘Make us pay, and you’ll pay,’ is their mantra!

Darrell Delamaide argues that President Obama must stimulate the U.S. economy sufficiently to boost employment figures in the near-term, otherwise Democrats will court a political disaster next year. However, the idea of America is far more consequential than today’s interest group driven party goals. In reality, Delamaide is not arguing for stimulus as much as he is arguing against the GOP. A better argument is to replace both reckless, feckless political parties and get the nation’s budgetary affairs in order.

Is irrational exuberance making a comeback at the Fed’s invitation? Irwin Kellner thinks so, arguing that the “humongous volume” of Fed injected liquidity invites a speculative fever. The Fed’s bogus money has not produced consumer price inflation because the wealthy beneficiaries of the liquidity are keeping it engaged in speculative pursuits, with little trickling down to consumers.

Has America lost its soul? Is America too immoral and shortsighted to allow prudent capitalism to work properly? (Yes.) Is the Canadian hedge fund manager, Erick Sprott correct that the U.S. government is now a “dead man walking,” with central bank intervention the main dynamic that allows the U.S. Treasury to roll over government debt at low interest rates? (Marketwatch, Oct. 20, 2009).

It is time to dismantle the central bank conspiracy. In countering the cabal, Farrell urges the reading of William Greider’s July 15 essay,“Dismantling the Temple”. Greider provides an exposition of the Fed’s calamitous financial biases and regulatory deficiencies. Furthermore, he draws attention to the bipartisan idea that the U.S.

Make no mistake, Fed Chair Ben Bernanke believes the Federal Reserve stands a fighting chance of re-inflating many segments of the economy and most categories of paper asset prices. Shrewdly, he is less confident that the Fed’s operations will result in a satisfactory recovery of America’s lost jobs. Fed Chair Bernanke can speak of the ongoing financial crisis as the worst since the Great Depression because his rescue of the banking industry will leave many Americans in the lurch.

All right, not everything in today’s Farrell commentary is erudite or even proportional. Nevertheless, he does make some valuable points. It is apparent that America is setting up various disgruntled interests in the world to make war with us. The U.S. decision to monetize debts in the face of a deepening recession is problematic. Quantitative easing (as it is called) will expose our international friends, competitors and enemies to economic complications as our U.S.

One war is over. Another one begins. The war to save America from plutocracy was lost this week as the federal government capitulated to financial sector demands for fresh capital and more bailout guarantees. Naturally, the Bush and Obama administrations don’t see themselves as losing the financial war. But they’re two of a kind when it comes to Wall Street. Just consider Obama’s willingness to work the phones to U.S. Senators to secure more money for financial elites.