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Do with ambassador John Bolton over the markets and what we got the -- signal we kind of went over before we could finish so we brought the ambassador back today for what were calling around to being dating back.
I already all right welcome back and so first of all I owe you an apology.
Because -- we have a lot of people who come on the show who.
Aren't in the stock market -- all you know they may be site tired just plumbers it doesn't matter they're really angry at the stock market rally and it just keeps saying that it's gonna collapse when they you have more you have indeed.
Read an income statement before.
Okay I'm not sure -- the last time you read what -- you -- -- you know about them what's resonated more curious to me is why you're so negative on all stocks being higher.
And and sort of you know this -- this whole thing is at the house of cards it's gonna collapse.
Well I think what is happening in the market is is a form of asset bubble because of excessive production money by the Fed through quantitative easing and and holding interest rates -- That's not to say that individual investors shouldn't take advantage of the market I'm not really talking about it from that perspective I'm talking about it.
From the public policy perspective I think there will be a reckoning.
In inflation down the road but I think there adverse consequences by the Fed's easy money policy.
Right now by holding interest rates down and discouraging savings I think the Fed is displacing.
A lot of private investment and I think the notion that the feds.
Monetary policy can make up for bad fiscal.
Is a big mistake I think this is way out of the -- -- I think it's well beyond the functions of the central bank and it not only has.
Negative economic crisis consequences I think it has negative consequences in terms of democratic legitimacy to.
You know I I I'm on the same page with you with respect to the Federal Reserve and -- -- earlier this I point out that when Alan Greenspan made his if -- -- irrational exuberance speech.
You know about the market being ahead of itself that -- in 2006.
We took a dip for about a month and then we rally like no other rally in history for the next 45 years.
Trying to call the stuff that was pretty difficult you know in other words there a lot of people who sat on the sidelines and just watch this in fact a lot of people.
Billions hundreds of billions of dollars worth of stock -- sold in late 2009 early 2000 late 2008.
Early 2009 a lot of those same people put all their assets and to goal thinking OK if that's gonna print money -- places that I go crazy.
And at this point they're getting cross on all fronts.
Well that that's said that's a function of -- decisions is individual investors I'm in the market I have a tiny amount of gold I haven't counted on it.
And and and my wife thinks we have we have more than we should -- but the real point is that if the market.
Valuation is an excess of what the fundamentals are and inflation.
Cakes and there will be a reckoning and and the Fed says no no look we're very worried about the prospect of inflation.
We're gonna catch it and prevented an all I can say to that is famous last words.
That this is a time of risk and I thought actually Bernanke did the right thing the other day by saying you know Q we.
Two or three or four isn't going to last forever.
Get realistic the economy is stuttering along but it is beginning to recover.
And that means the Fed should resume its normal role not as the sole instrument of policy.
But is the Central Bank.
You know maybe Ben Bernanke agrees with you when I listened to him speak I also -- hint at fiscal policy all time you just talked about fiscal policy.
Do you think in some respect the Fed feels like they have no choice they have no partner in this thing that they're doing all the heavy lifting themselves hits the extra risk.
But I think that's the problem Charles because if you've got gridlock in the government.
That that's just the way it is that that's the government -- people get the government they deserve and until we get straight what kind of policies we want.
Yet you're not gonna have a coherent fiscal -- regulatory policy in fact I'd say over the last four and a half years government policy is done mortar were -- Our recovery -- do advances but my point -- that the Fed is it's not the plan.
This non transparent autocratic.
A group of very intelligent people.
But but -- we didn't elect and -- -- we didn't select an aristocratic form of government in this country just because the Fed has an important role.
Does it mean that if other branches are doing what you think they should.
The Fed should step and nobody gets to elect the Fed nobody gets to campaign about the -- I just think I just think it's.
It moves in the direction of of the Europeans in the European Union.
Where governments and Italy and Greece do the wrong thing he pushed the government aside and -- the European Union take over I think that's a big mistake.
Well you know what I I agree 2000% when it comes at a Federal Reserve and I'm glad that we emailed each other.
-- marquee of the queen's very rules for the day Staten.
Theft to have round three update things a lot of.
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