Federal Reserve Chairman Ben Bernanke called on Congress on Monday to adopt tougher budget rules even as the nation’s top central banker warned against taking deficit-cutting action too soon.
Still, Bernanke also warned against tightening too quickly and reportedly said more asset purchases by the Federal Reserve could help the economy.
The government’s addiction to debt and deficit spending is being enabled by the Federal Reserve which is buying its debt with money that is created ex nihilo. So if Bernanke wanted, he could stop the addiction. It’s like the wife who responds to her alcoholic husband who has asked her to bring him a drink, “Dear–you really must stop drinking so much … Would you like that on the rocks?”
Meanwhile, gold has climbed to $1330.