This is a rush transcript. If you notice any errors please report them using the “Help improve this post” link at the bottom of this post.
Neil Cavuto: Ben Bernanke today denying investors any hint of another round of stimulus, although he kind of left them hanging. That’s got to be welcome news to GOP presidential candidate, Ron Paul, who joins us now on the phone. Congressman, he sort of just punted today. The markets wanted to see more help, but he more or less said, “Well, we’ll have another meeting next month”. What did you make of that?
Ron Paul: Well, he doesn’t have much options, he only has one tool, and that is to inflate the currency. And because he didn’t announce another program and said, “We’re just going to maintain this steady ship of state”, what he’s doing really is a form of QE because how does he keep interest rates low? He has to keep monetizing the debt.
Neil Cavuto: Congressman, you’re a genius, I just want to bring this to levels even I can understand, and that is QE, you’re referring to Quantitative Easing, comes in the market and essentially buys up a lot of securities and debt, essentially prints money. You’ve never been a big fan of that, you’ve never been a big fan of the Fed, but the market is always looking for a tonic and that’s the tonic they’re been waiting for. Just what do you make of that oddity?
Ron Paul: Well, I don’t think there is a tonic yet, I think there are still too many uncertainties going on. I mean, he’s guaranteed he’s going to continue the process, he’s just indicating he’s not going to have any more surges. But we’ve been doing this for a long time, Greenspan did it; he kept interest rates too low for too long, and we had QE1 and QE2. But as long as Bernanke is saying he’s going to go into 2013 and maintain very, very low interest rates, it means he has to be very active, because if foreigners decide not to buy much, he has to buy up these treasury bills to keep the interest rates low. So I don’t think a whole lot has changed, but he just didn’t have any big announcement, he wasn’t looking to stir up the markets, he was trying to calm the markets. But he certainly didn’t calm the gold market, the gold market recognizes that he’s still going to print a lot of money and he’s hoping that if he throws it back to the Congress, Congress will cut back on the deficit, which isn’t going to happen. So next week, of course, will be another week and we’ll see what happens then, how people will interpret this all.