Rick Santelli Strikes Again

The Godfather of Tea Parties has struck again. This time, Treasury Secretary Tim Geithner is the target. Geithner was asked the following by Steve Liesman on CNBC's Power Lunch:

Steve Liesman: Treasury is issuing over time and not so much time trillions of dollars of debt. The Fed's buying $300 billion of Treasuries. Why is this not the dreaded concept of monetizing the debt which so many economists would warn against?

Now look at Geithner's response and Santelli's reaction:

GEITHNER: There's no risk of that in the United States because, again, we have a strong independent central bank whose obligation under the law is not just to achieve maximum sustainable growth but to keep inflation low and stable over time. And I know the chairman is completely committed to that.

SANTELLI: Are we monetizing? And his answer was no, we have a strong independent central bank. Now, the latter may be true, but it certainly isn't an answer to the question. And I'd like feedback everybody, that quantitative easing can't exist without the monetization process. We issue debt, we print the money to buy it. That is monetizing. I can't believe that was his answer. It's pretty disingenuous. If that's the Treasury Secretary in charge of all this activity and that was his answer, it makes me nervous. Blatantly saying they're not monetizing when the March statement for the first time ever expressed quantitative easing and put it on the map, I just think that that's the wrong answer. He's not telling the truth!

So Santelli has called Geithner out for lying. Not only to Americans, but the Chinese as well. Santelli's right, we are monetizing the debt. Monetizing the debt is, we issue debt, we sell Treasuries. We do this or that. Then we print money to buy it ourselves. They have these auctions, Treasury auctions, they're not raising as much money as they are projected to raise, we sell Treasuries and monetizing the debt as we issue the debt, meaning, we've made a decision to spend $12 trillion we don't have. So that $12 trillion of debt, well, you have to monetize it, the $12 trillion has to be something. So you print the money. Now, we're not going to print all $12 trillion at once, we're going to print it as we need it. That's why there's still time to stop this with elections in 2010 and 2012. Right now the deficit probably this year, two trillion, but with all the other stuff Obama wants this summer it will be more like four. So you print the money to monetize the debt. Therefore it's inflationary. The Chinese are totally right about this and they're scared to death that we're monetizing our own debt. You should be, too because it will make both our and the global economy worse. And Geithner's over there telling the Chinese we're not doing that, that's just absolutely absurd. They're laughing at him and they're ticked off at him in these meetings. (HT Rush Limbaugh, Real Clear Politics, & Radio Equalizer):

Rush Limbaugh: Santelli: Little Timmy Is A Big Liar
Real Clear Politics: Santelli: Geithner Is "Lying To The American Public"
Radio Equalizer: Rick is Back! Rush: Santelli's "Somehow Broken Free" of NBC's Crackdown