HilsenWrath

Lights go out and I can't be saved
Tides that I tried to swim against
Have brought me down upon my knees
Oh I beg, I beg and plead
--Coldplay

The Wall Street Journal's Jon Hilsenrath is known as the Fed's 'mouthpiece' because it is well known that the Federal Reserve likes to communicate with the public thru his writing. Little that Hilsenrath writes about does not have the Fed's stamp of approval.

Last Tuesday Hilsenrath penned 'A Letter to Stingy American Consumers' basically asking why people aren't spending more. This is a question to be expected from Keynesian central bankers. The economy depends on spending, they believe. We need you to consume more. Why aren't you doing so?

Responses to the column were largely hostile. Many found the column offensive and wrought with central banker arrogance. Responses reflected mistrust in federal government and pessimism about the economy. There was also the theme of stagnant incomes in the face of rising costs and high debt loads.

Of course, Hilsenrath tried to downplay the intent of his original letter--calling it playfully 'tongue-in-cheek.' In other words, his original letter wasn't really serious.

Here is an interesting letter back to the Fed that captures many of the issues facing consumers. The Fed has created conditions of financial repression that have gutted capacity for saving and capital formation. Fed policies have not raised incomes or wealth for anyone except those at the top of the economic pyramid. Moreover, QE policies have enabled government to buy its own debt, shouldering people with even more future obligations.

Some people foresaw this situation years ago when the Fed was in its nascency. Plainly, today we witness Fed policies that enrich special interests at the expense of others.

Fed bureaucrats and their mouthpiece seem surprised that people actually understand what is happening.