You can’t make this stuff up! “Ben Bernanke’s plan worked; what happens after?” says AP

Heading the list under the top financial news story of the first day of March is an Associated Press article, entitled, �Ben Bernanke’s plan worked; what happens after?� (AP article here).

�Nearly everything is going according to the plan Federal Reserve Chairman Ben Bernanke hatched six months ago,� the AP begins the article. �Since then stocks have soared, the unemployment rate has dropped and Americans have started to spend more.�

In shocking contrast to American sentiment regarding the Fed‘s unpopularity with a struggling, scared and angry American public outlook toward banks and politicians who support them, the AP defends the Fed for its bailouts of banks (and not homeowners) and dollar debasing activities referred to as �quantitative easing.�

Gasoline, food and a dozen other expenses climb higher�on top of crashing wealth to the middle class, unemployment and budget cuts at the state a municipal level.

�The move [QE2], which began in November, was unorthodox, but the logic was simple: Buying $600 billion in Treasurys would make borrowing cheaper and move investors out of low-yielding bonds into riskier investments like stocks,� AP explains. �A lot has happened in the markets and the economy since then — most of it good.�

Banks are making profits and bonuses, but recently publish data points out that 26% of mortgage holders owe more on their home than their home is worth. But according to the AP, most of what has happened since the Fed embarked on a debt-buying spree has been good! For whom?

The response by readers to the article is a great story, in itself.

Better yet, the real story regarding this abomination of a piece by the AP is two-fold.� An article such as this one, posted on a popular Internet site, where intelligent people who seek news in print, wreaks of blunder on the part of some Fed or Treasury official who �suggested� it be �written� in the first place.

No editor in his right mind would let this article through knowing this financial fiasco and the cover up by a complicit media has not gone unnoticed by even people who didn’t know the difference between the Federal Reserve and Federal Express before this crisis began more than three years ago.

Or maybe, the piece is a trial balloon as a means of gauging last-minute sentiment on the issue of QE2 by the American public as Bernanke begins his two-day testimony before Congress today. Surely he’ll be asked about the prospects of a QE3.

The good thing about the Internet is its place for readers’ comments. Professional traders understand the importance of sentiment. A bogus argument made about a stock, sector, or, in this case, Fed policy, doesn’t mean you should fight the madness of crowds, or the Fed either, for that matter. Sentiment is paramount to the Fed at this moment in its 98-year-long reign over the nation’s monetary matters. The stakes have never been higher for its survival.

The AP states that stocks have soared.

So have stocks listed on the Zimbabwe’s stock exchange during the collapse of the Zimbabwe dollar. Priced in silver, oil and Mars bars, the S&P has dropped. At best, priced in gold, the S&P is flat since November.

Taking a page from the Fed’s FOMC meeting minutes of September, AP suggests the Fed’s plan to inflate stock prices by means of buying newly auctioned U.S. Treasuries at a rate that has exploded the monetary base in the process is a good idea.

If you’re a stockholder, hats off to the Fed. But has unemployment really dropped for those who have sold stock to pay daily expenses? Is QE2 really about the economy, anyway? Isn’t QE2 a recognition that the Fed has to monetize debt to keep interest rates as low as possible, which has only transferred wealth to commodities traders at the expense of retirees?

�If you want to see lies just wait for Friday’s unemployment report,� writes Yahoo reader, Len T.
Another Yahoo reader, George, writes:

�There are two big LIES – PROPAGANDA in this AP junk.

FED had NO choice but to BUY Treasury bonds/Notes. NOBODY was buying them.

The BIGEST LIE in AP article is about unemployment!�

In an effort to lend credibility to the article, AP quotes Pimco’s Bill Gross, dubbed the Bond King, who stated, �It’s [QE2] been a success.�

�It’s hard to dispute that since Jackson Hole the market is up around 25 percent,� added Gross.

It’s hard to find a commodity that’s �soared� less than 25% since Jackson Hole.

�What is this? If you keep lying enough the ignorant masses will believe it to be the truth?� commented Yahoo reader The Yahoo Censor Man.

Anonymous writes, �Yes Bernanke plan worked. Still 17% unemployment. Food and gas inflation rising at 20+ percent. Its working if his plan is to destroy the U. S.�

The avalanche of cynical, anger and facetious comment must be a record for a Yahoo post. It could take a while to find a reader in support of the �Bernank� and the �JP Morgue� in the comments.

The bottom line to the Fed’s �unorthodox� policies (as AP put it) to cope with a financial system so top-heavy in debt should be characterized instead as insane. Impoverishing 90 percent of a population slowly (more quickly now) through debasing a nation’s currency is precisely the predicament that precipitated the riots in Tunisia, Egypt and Libya.

Contrary to the mainstream media’s bungling (not all) of the real story behind unrest in Northern Africa and the Middle East has little to do with ideology of how nations should be governed; it’s about feeding people.� And these poor nations have the Fed and Ben Bernanke to thank for raising the cost of approximately 50%-75% of a household budget dedicated to paying for the human right of eating a meal or two each day.

The controversial religious and political American figure Louis Farrakhan may have it right when he said, Monday, �What you are looking at in Tunisia, in Egypt, Libya, in Bahrain � what you see happening there � you�d better prepare because it will be coming to your door.�