Saturday, March 31, 2012

Jim Grant – Will Open Office of Unintended Consequences

  • ‘When President Ron Paul Appoints him Fed Chairman’ 

Jim Grant (Grant’s Interest Rate Observer) tells CNBC’s Maria Bartiromo he would set up a new Office of Unintended Consequences – just as soon as the Hon. Ron Paul is elected President and appoints Grant as new Fed Chairman.  (Only partly tongue in cheek we reckon.) 

Grant says that the Federal Reserve got out of the central banking business a long time ago and is now in the central planning business. (More.)

 

Continued...

 
***

The affable Grant points out that the purpose of a market is to discover true value, true prices through the price mechanism.  Thanks to Fed intervention markets are very distorted. “The Fed systematically overrides the price mechanism,” Grant said.  “The Fed is an anti-capitalism business, which is not what the founders intended,” he added. 

Grant likens the signals being sent by the markets today to the reflections one sees in a hall of mirrors. “What we see is not what we think we see, it’s what is distorted through central bank manipulation.”

So what should the Fed do now? 

Grant allowed:  “They ought to get out of the manipulation business. It (the Fed) ought to begin to normalize interest rates, they ought to forswear intervention in markets, with an eye to improving the macro economy. They ought to let prices tell us something about the nature of value and stop imposing itself between buyers and sellers in the marketplace.” 

He continues to favor gold and especially gold and silver stocks, which he says have not kept up with the metals.  He also believes that if the Supreme Court overturns Obamacare in June or if the Republicans retake the White House it would be “hugely bullish – because it would be a step in the restoration of something like capitalism in this country, I say.”  More in the video above.  If the video is not visible try the link below.    

Source: CNBC
http://video.cnbc.com/gallery/?video=3000080414

Thanks to Vulture C. C. for the link. 


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Vulture Speculator

Trading gold, silver and mining shares since 1980 with a focus on taking advantage of volatility extremes, Gene Arensberg analyses the markets through a basket of technical and fundamental indicators and shares his findings from time to time here at Got Gold Report. Mr. Arensberg has been quoted in the Wall Street Journal, Dow Jones MarketWatch, USA Today and dozens of other news organizations.

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