Interesting article C-grad. BTW, Tyler Durden and Zero Hedge are one of the economic "go-to" sources for many progressive pundits and commentators.
As a reminder, in America consumption, not the government (which despite incorrect claims to the contrary has never created even one penny of wealth), is responsible for 70% of annual GDP. Is it any wonder that the Fed's own policies, done solely to protect the financial system, and to enrich those whose wealth is already primarily in the stock market (the infamous "1%"), are the cause of the ongoing catastrophe that is the destruction of America's middle class, which day after day sinks lower and lower?
I disagree with the point about government not creating one penny of wealth. Government spending and allocation of land and resource extraction has created a ton of wealth. But I do agree about the redistribution of wealth upwards.
And so on. If by now it is unclear to anyone that Bernanke is not only not doing anything to help America, or the world, but is merely accelerating this country's destruction, and perpetuating the same practices that result in breakouts of food price shocks leading to isolated genocide in those parts of the world without a safety net, then we congratulate you on your imminent receipt of a Nobel prize in Economics
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Where does that safety net come from?
Finally, for those asking "what should be done", Einhorn's suggestion is identical to the one Zero Hedge has preached to its readers since day 1, nearly 4 years ago. And we don't even charge 2 and 20...
If Chairman Bernanke is setting distant and hard-to-achieve benchmarks for when he would reverse course, it is possibly because he understands that it may never come to that. Sooner or later, we will enter another recession. It could come from normal cyclicality, or it could come from an exogenous shock. Either way, when it comes, it is very likely we will enter it prior to the Fed having ‘normalized’ monetary policy, and we’ll have a large fiscal deficit to boot. What tools will the Fed and the Congress have at that point? If the Fed is willing to deploy this new set of desperate measures in these frustrating, but non-desperate times, what will it do then? We don’t know, but a large allocation
Yep, that's the concern. They've tried to provide a soft landing but have no plan for how to get back up. Makes you wonder if, in the long run, we wouldn't have been better off letting the shit hit the fan.
So who should listen to: a failed historian-economist who has never worked in the real world, who has no idea how human behavior plays out in reality, who has lived in an ivory tower all his life, and who has never had to put his money where his mouth is, or a self-made billionaire? For us the choice is clear.
Appointed by Bush, re-appointed by Obama. As Cleets alluded to, this is another product of the duopoly.
Paul-Sanders in 2016!
sad