I predicted a few nights ago that the word “stagflation” would re-enter the mainstream lexicon. A Congressman just put the term to Bernanke and said we may be facing a replay of the 70s. Of course, Bernanke, quickly becoming a political creature, refused to fess up to the truth and just dismissed the possibility.
Our hero, Ron Paul, put the lie to the official line that a weakening dollar doesn’t affect Americans since they buy goods priced in dollars. Bernanke tried to respond that other than imported goods, the weakening dollar doesn’t hurt Americans. Paul responded that seniors on a fixed-income are seeing their cost-of-living go through the roof, [...]
Continuing with our blow-by-blow breakdown of Ben Bernanke’s testimony: A Congressman just pointed out that Bernanke made a bad prediction 7 months ago regarding the severity of the housing crisis while that Congressman was correct in his prediction that supply would reach 10 months. The politician then asked Bernanke what the impact would be, using [...]
Bernanke is testifying as I type this and he just made the suggestion that the Federal Government help the mortgage crisis by guaranteeing Freddie & Fannie’s exposure to allow those GSEs to buy and package more loans. Of course, they’ll underestimate exposure to possible losses from these mortgages and the taxpayer will be left holding [...]
While Ben Bernanke may be feeling quite proud of himself at the moment, the financial markets are pondering his next move. In the latest Barron’s, Randall Forsyth spends a whole article pondering Donald Kohn’s jawboning and its affect on fed-funds futures. Apparently, they are pricing in lower probabilities of further rate cuts. Obviously, that market’s [...]
