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Raise rates, cowards

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Clay Bennett / The Christian Science Monitor / File

(Read caption) Prime interest rate cuts haven't worked to slay the financial crisis, so it's time to try something else. You say the recession is over? Start acting like it, by raising rates and jump-starting economic activity.

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Here's the deal, FOMC - I'm going to give you the intellectual cover you need to do what many people believe is impossible right now. I'm going to help you get the jelly out of your spines. Bear in mind that what I'm about to hit you with is coming from both street smarts and Street smarts; I ain't the professor of nothing.

Benji, your "I'm a student of the Depression" rap is totally rate-arded at this point. No one's going to call you Hoover, you can stop now.

What should you do? Pay close attention, because I choose my words very carefully and I never repeat myself...

The Move:
The Fed Funds target rate needs to go to 1% immediately. It should happen out of nowhere, not during one of your regularly scheduled FOMC slumber parties. That's how China rolls, nobody gets advance notice of nothing. No jawboning, no telegraphing. It just IS.

The Perception:
The statement should be something to the effect of "now that the recovery has firmly taken hold..." Anyone who's raised themselves up in the business world understands the concept of "Fake it til you Make it" and a lot of economic activity is based on perception and confidence. Your woe-is-me rate policy gives me all the confidence of an airline pilot wearing two different shoes.

Unemployment:
Obama and Geithner need to be on board and on message so they can punch the first guy who whines about unemployment right in the mouth. One major reason that small businesses aren't hiring is because there is no urgency. They all have plans to grow and expand and branch out in the future, but you need to send a message that the time to borrow free money is now. Today. That'll get some hiring done for certain, trust me. On the street, we call that Closing. Close us as Americans on the recovery. Tell us it's the end of the desperation phase and we will mobilize to get back to business. Also, keep in mind that we've had zero percent interest rates for 2 years now, nobody has hired anyone. It's not working, get over it.

Intelligence and Reason:
Get BlackRock's Larry Fink in the mix on the rate hike thing. He's one of the few financial industry captains openly calling for a rate hike and he's smarter than these "Council on Economics" imbeciles by half. Listen to people like Fink who have a better view of the flow of capital than any of your academic friends.

The Banks:
The free money game for the banks has been a holocaust for savers and the elderly. It's also been the most despicable corporate giveaway in American History. Allowing the banks these risk-free, automatic profits is treason. Stop it now. Force these banks to do their job and serve their function in society - the financing of business activity. No more borrow-from-and-lend-to the government.

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Inflation:
Be sure to emphasize the need to head off inflation before it gets serious. This is an argument that Americans will understand and respect, especially those over 45 who were there in the early 80's. Your CPI measure of inflation is a demonstrable sham and there's no one who doesn't know it. Go take a peek at industrial and food commodities and then tell us there's no inflation. Grow up already.

Housing:
What's more powerful than a home buyer's tax credit? How about scaring the socks off those who've been on the home buying sidelines. How about throwing a bucket of ice water right in the real estate investor's face, letting him know that NOW is as good as it gets. How do you do that? Jack rates up by 100 basis points overnight. In sales, we call this the Walk-Away - "OK you don't want it, no problem, I've got other buyers waiting so thanks for coming in today. Bye now!" Keep laughing, but believe me, you'll see homes cleaned out quick when the door appears to be closing.

Currency War Nonsense:
Are you kidding me? All these "emerging markets" that just ten years ago were borrowing spare change from us need to shut up. How dare you allow those nations to make threats and dictate currency rules and regs to the United States? Act like a leader, raise rates, and tell the developing market children to know their role and shut their mouths. We don't need to engage in this debate on the world's stage with countries who are getting by on the shiny rocks they've found in the ground. Until I'm picking up garbage for a living in another country and sending home cash to my family up north, I'm still a citizen of an empire. The Empire, the last one standing. Why would we need a currency war? Why would we join them when we can already beat them? Enough.

I'm getting sick and tired of hearing about the dollar's decrepitude and by extension, our own. Man up, Bernanke. We will have your back and this pathetic economy will finally pick itself up and get back to work.

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