Bernanke Claims Financial Markets Are (Just About) Normal Now

Which normal is this, the normal from before or the new one? Could I please get a clarification on that? Because from where I am standing this is most certainly not normal.

If this is normal, where the hell is everyone? Certainly not in the S&P nor anywhere else we've checked lately. Let's face it, most markets have turned into an adult arcade with the Fed jerking off HFT robots through a hole in the booth wall. Is that normal?

If you are Ben Bernanke it is.

Let's pretend Ben Bernanke is a doctor and his patient, Mrs Economy, came down with a terminal illness in March of 2008. Her symptoms were obvious for years before that but each time she came to visit Dr Bernanke to find out what was wrong, he ran a battery of tests and declared he just didn't know what was wrong. Finally Mrs Economy presents to the Emergency Room in septic shock and practically dies right there on the gurney. But not to worry, Dr Bernanke tried some experimental treatments not approved by the FDA, pumped her full of chemicals and - WOW! - saved her! Now the treatment actually put her into a coma and she's been on life support ever since but don't let that ventilator fool you, Mrs Economy is all better because she lived and that's what matters.

You with me?


“Although financial markets are for the most part functioning normally now, a concerted policy effort has so far not produced an economic recovery of sufficient vigor to significantly reduce the high level of unemployment,” Bernanke said in his speech.

New regulation should reduce the risk of future financial crises, he said, while calling for more research on asset price bubbles, market liquidity and decision-making during panics.

More research? Please, we don't need more Fed senior economists putting their big brains together to know that asset bubbles are A) inevitable and B) encouraged. Nor do we need any of the bastards to come up with a study that determines we are in the midst of attempting to blow the biggest one ever right now, that's sort of the game plan and surely Ben Bernanke knows as much.

The only regulation that could reduce (or eliminate) the risk of future financial crises would be one that declares the Federal Reserve unconstitutional, strips them of the ability to manipulate the money supply and leaves the Fed with only check processing and nothing more. That means dismantling NY Fed's open market operations (oooh sorry, U.S. government, you're going to have to find a new greater fool to pimp your debt out to), handing bank supervision off to an OCC/OTS hybrid agency completely independent from the Fed and of course FDIC (that's called segregation of duties, look it up) and canceling the FOMC. Screw it, they haven't been doing their jobs very well lately, if they were employees of a corporation they'd have already been fired.

Someone needs to teach Dr Bernanke a lesson in First Do No Harm. Then we can go back to arguing about whether or not any of this is "normal".

Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


W.C. Varones said...

And, Mrs. Economy, that's not my thermometer.

Credit is Like Nostalgia:

It is prone to lead to procrastination and prevent us to go forward!

Our economy is slowly dying, your job, lifestyle are dominated by anxiety.

No one is proposing a solution because no one has the slightest idea of why it is happening and many have vested interest in the present system.

However an objective observation of the phenomenon can help us understand it and provide us with an innovative solution.

Of course we can't solve the problem with the tools that brought us there in the first place and we need a new ideology.

- Do you feel that your ideology pushed you to make decisions that you wish you had not made?

- Well, remember that what an ideology is, is a conceptual framework with the way people deal with reality. Everyone has one. You have to -- to exist, you need an ideology. The question is whether it is accurate or not. And what I'm saying to you is, yes, I found a flaw. I don't know how significant or permanent it is, but I've been very distressed by that fact.

- You found a flaw in the reality...(!!!???)

- Flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak.

- In other words, you found that your view of the world, your ideology, was not right, it was not working?


In order to alleviate those economic woes wee need to create, as fast as possible, a new credit free currency that will solve the credit crunch and bring incremental jobs, consumption and investments to the present system.

An Innovative Credit Free, Free Market, Post Crash Economy

Tract on Monetary Reform

It is urgent if we want to limit social, political and military chaos.

Is the fulfilment of these ideas a visionary hope? Have they insufficient roots in the motives which govern the evolution of political society? Are the interests which they will thwart stronger and more obvious than those which they will serve?

I do not attempt an answer in this place. It would need a volume of a different character from this one to indicate even in outline the practical measures in which they might be gradually clothed. But if the ideas are correct — an hypothesis on which the author himself must necessarily base what he writes — it would be a mistake, I predict, to dispute their potency over a period of time. At the present moment people are unusually expectant of a more fundamental diagnosis; more particularly ready to receive it; eager to try it out, if it should be even plausible.

But apart from this contemporary mood, the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist.

Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas.

Not, indeed, immediately, but after a certain interval; for in the field of economic and political philosophy there are not many who are influenced by new theories after they are twenty-five or thirty years of age, so that the ideas which civil servants and politicians and even agitators apply to current events are not likely to be the newest. But, soon or late, it is ideas, not vested interests, which are dangerous for good or evil.


Credit Free Economy
More Jobs, No Debt, No Fear.
Prosperous, Fair and Stable.