There is a series of "lectures" given by congressman Ron Paul to Ben Bernanke, available on YouTube, for example this is a fairly new one and a great example:
Ron Paul Schools Ben Bernanke Yet Again 2-27-08
I believe Ron is right when he infers that CPI is an indicator deliberately constructed to show whatever the Fed wants it to show. Let's not forget that food and fuel prices are excluded from the CPI! This is crazy. I mean if oil prices go up, practically everything will be more expensive, since we need transportation for virtually everything. This is pure inflation. Basically, by excluding fuel prices from the CPI, a raise in fuel prices will show up later in the price of all goods, so for a while the Fed can say that CPI is low, don't worry, but after a while the raising transportation costs will definitely show up in the consumer prices.
In another video Bernanke states that the value of the dollar only affects the value of imported goods, so people should not be worried about the price index:
Ron Paul vs Ben Bernanke - Monetary Inflation - 11.08.07
Did he somehow forgot to mention that most Americans depend on imported oil, they buy imported clothes, electronics and so on? As proof, let's look at the Trade Deficit.
One more video, I love the end of this one :-)
Ron Paul and Ben Bernanke, part 2 of 2
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"There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." |
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