The following link contains a video of Ron Paul Blasting Bernanke on the Value of the Dollar and Price Fixing.

The ABC news article missed some key transcripts, that I have listed below:

Ron Paul:

We don’t talk about how we got here.
We talk about how we are going to patch it up.
The bubble has been burst… and nobody says where does it come from?

And what is the advice that you generally get?
[The answer] is inflate the currency.
They don’t say inflate the currency, they don’t say debase the currency, they don’t say devalue the currency, they don’t say cheat the people.
They say lower the interest rates.'”

And you never tell them ‘the only way you can lower the interest rate is to create more money’. I see this as the problem we don’t want to talk about.

We [need to] get down to the bottom of this and define what inflation is, and not look at only prices. This was taught by the free market economists all through the 20th century. They [the free market economists] said ‘beware, [the central banks] will increase money supply but they will make you concentrate on prices. And they will give you CPIs and PPIs and fudge those figures’.

We ignore the fundamental flaw and that is not only have we had a subprime market in housing, the whole economic system is subprime in that we have artificially low interest rates. This has been going on for 10 years or longer and now we are bearing the fruits of that policy.

Instead of looking at consumer prices which nobody in this country really believes, we need to talk about the distortion, the malinvestment, the misdirection, the bad information that is gotten from artificially low interest rates. In may ways people refer to you as a price fixer. You fix interest rates. When the Fed fixes interest rates at 1%, that is price fixing.

The real deception is when we distort the value of money, when we create money out of thin air.

We have to get back to the very fundamentals of where this problem [bubbles] comes from. And the bubbles occur when we have malinvestment and the creation of new money.

So my question boils down to this: ‘How in the world can we expect to solve the problems of inflation, that is the increase in the supply of money, with more inflation.’

Thanks Ron Paul for seeing the light and telling everyone how it is.

Interestingly enough even Greenspan is now admitting we do not need a Fed but we do need to return to a gold standard or other mechanism that restricts the amount of money that is produced. See Greenspan on Housing, Central Bank, Gold.

Like Ron Paul says we do need to get back to fundamentals and that starts with sound money and sound definition of inflation. Unfortunately we have a Fed that discusses everything under the sun except money supply and inflation. See Oil is set to hit $100 a barrel: Is This Deflation?

It’s time to eliminate the price fixers in this world along with the IRS and dozens of useless government agencies. There is only one way to do that and that is to vote for Ron Paul.

Someone just sent me this You-Tube version of the Video.

Mike Shedlock / Mish
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