Is Ben Bernanke Going to School Ron Paul?
Ignorance is bliss.
Roger Nachman writes in Ben Bernanke To Teach Economics To Ron Paul via Benzinga:
Federal Reserve Chairman Ben Bernanke will have a few bullets the next time him and Ron Paul meet in a Congressional setting.
Since Bernanke's famous Jackson Hole speech, the S&P 500 has jumped 18%.
The risk premium on high-yield, high-risk bonds has fallen to 5.16%, down from 6.81%, according to Bank of America Merrill Lynch index data show.
Inflation expectations have skyrocketed, up 44.4% since the speech, and unemployment is at the lowest it's been in two years.
Peter Hooper, chief economist at Deutsche Bank, said QE2 was essential. It “was a key factor in taking deflation risk off the table. It certainly helped bolster longer-term inflation expectations, and it was a factor that contributed to the rally in the stock market. Overall, I give it a good grade.”
“QE2 has given us some opportunity to act on our debt and deficit, and we have not taken advantage of that,” House Financial Services Committee Chairman Spencer Bachus said at a March 2 hearing. “Any criticism directed at the chairman, you need to also sort of point that finger back at yourselves,” said Bachus, an Alabama Republican.
The way I see it, Ron Paul will have more than an "I told you so" banked up the next time he sees Ben Bernanke. By the time they meet up again, inflation will be out of control and that Fed exit strategy they never had will be a memory, replaced with more panic to stem the fury of out of control inflationary madness.
We know what happened last time.