<blockquote>'PIMCO founder, managing director and co-CIO endorsed QEII as discussed in
Bill Gross' Arrogant Endorsement of Fed's QE Policy he calls History's Most "Brazen Ponzi Scheme".
...
Abolish the Fed and End Fractional Reserve Banking.'
- Mish,
Three Reasons QEII Will "Backfire"; Pavlov's Dogs and the "No Choice" Argument Yet Again, November 04, 2010</blockquote>
'..a Volckerite monetary policy would be imposed.'<blockquote>'Unlike in 2000, when bearish commentary was on thin ground, it is now quite possible to find outlooks a lot more bearish than this column’s. Stephan Richter’s piece in the Globalist
“The Weimar Republic and the Ominous Rise of Jon Stewart” is one such – the likelihood of the U.S. going Nazi in the short term is infinitesimal, though below I discuss one possible scenario under which it would become less unthinkable.
...
With electoral responsiveness still low, that could allow President Obama to be re-elected in 2012 in an apparently modestly improving economic environment (albeit with inflation already beginning to surge). In that case the likelihood must be for a second 2008-style financial crash early in Obama’s second term, from a bursting of the bubbles in commodities, junk bonds and other financial assets. The policies of zero interest rates and fiscal stimulus would not then be available to re-start the economy, since inflation would already be substantial and rising and the budget deficit would already be at a level causing Greece-style difficulties in the bond markets.
That’s the situation in which the Weimar Republic analogy begins to be appropriate. Germany in 1931 was less than a decade away from hyperinflation, its borrowing capacity in international markets was zero and its banking system was defaulting. In such a situation severe economic hardship is inevitable. If the political system is unresponsive (as was Germany’s coalition-bedeviled Weimar Republic) an extremist figure who appears to offer a way out of difficulty through economic autarky and invasion of countries with raw materials becomes electorally irresistible.
...
Finally, there’s the possibility of high economic and electoral responsiveness. In this case an assertive GOP Congress reduces the federal deficit, but Bernanke’s continuing lax money causes the current bubble to burst and inflation to surge well this side of the 2012 election. At that point, Bernanke would presumably be removed, possibly by impeachment, and a Volckerite monetary policy would be imposed.'
- Martin Hutchinson,
Ten years of bearishness, November 01, 2010</blockquote>