My avid readers will already know that I think the secretary of the treasury, Geithner, needs to go….he has not done anything but help those that have caused the meltdown….time for him to depart…..
This post is about Bernanke, the head of the Federal Reserve, personally I think he should do us all a favor and resign….yes I have my reasons…….
In my opinion…he was dumb to the fact that a economic tsunami was approaching back in 2008….he kept telling us all that the economy was fundamentally sound….he was caught with his pants down….he has done fairly well since the crash…but my confidence is not ther any longer…
The faculty of Univ, of MO-KC have an excellent post:
When first nominated as chairman of the Federal Reserve, Mr. Bernanke promised a greater degree of transparency than his predecessor, but has completely stonewalled anybody seeking to obtain clarification of the events surrounding the credit crisis and more specifically, the role of the Federal Reserve. Any information disclosed would have facilitated a proper assessment of Bernanke’s job performance (which is probably one of the reasons the Fed chairman doesn’t want it released) and, more importantly, would have created a foundation for useful forensic work to prevent recurrences going forward.
The Fed chairman claims unique expertise on the grounds of his scholarship of the Great Depression. Few have actually challenged him on the basis of these academic credentials, yet Bernanke holds these out as if they are manifest proof of his appropriateness for the position as head of the Federal Reserve. Ironically, even though Bernanke drew heavily on the work of both Milton Friedman and Anna Schwartz for his own scholarship of the period, Ms Schwartz herself has been enormously critical of the Fed’s conduct both pre-crisis and in seeing providing liquidity as the primary solution. She also warned explicitly against drawing comparisons between the gold standard era Depression and now. Additionally, Bernanke’s reading of the Depression (which is pretty conventional, that the Fed blew it by not providing more liquidity) ascribed little significance to fiscal policy, which has led Bernanke toward wrongheaded “solutions” such as “quantitative easing” and an alphabet soup of lending facilities, none of which did anything to enhance aggregate demand. Consistent with that, the Fed chairman been on the wrong side of fiscal policy, urging the Congress to balance the budget, at least longer term, which suggests that he learned nothing of the fiscal successes of the New Deal.
Bernanke’s consistent advocacy of “quantitative easing” perpetuates the silly notion that the Fed has had something to do with the economic “recovery” (a line which Time Magazine had readily embraced in its selection of the Fed Chairman as “Person of the Year”). He has ascribed little importance to the existence of the automatic stabilizers and indeed has persistently fed the misguided notion that the Federal government had limited fiscal resources.
The Fed chairman continues to demonstrate a tremendous conceptual confusion at the heart of the current crisis, particularly in regard to the banking sector. He actively supported TARP on the grounds that repairing the banks balance sheets would somehow “unblock” credit flows and thereby enhance economic activity. The whole notion of repairing bank balance sheet is a lie and misdirection. The balance sheets we should want to see repaired are household balance sheets. Banks have failed us profoundly. We want them reorganized, not repaired. This will never happen as long as this apologist for Wall Street remains head of the Fed. A world in which the banks are all fixed but households are still broken is worse than what we have right now. Too-big-to-fail banks restored to health are too-big-to-fail banks restored to power. The idea that fixing legacy banks is prerequisite to fixing the broad economy is a lie perpetrated by, amongst others, the Federal Reserve Chairman.
The critique above is about the best analysis I have seen on the performance of Bernanke…..and I agree….it is thime for him to GO!
Unfortunately, he will be reconfirmed…why?….Wall Street wants him there….he is their best friend for now…….and we ALL know how much influence Wall Street has bought over the years….so yes, Irene, he will return as the head of the Fed…….and the people wait!
By now the entire world is reeling from the recession that has effected everyone, in one way or another….economic growth has been dismal and recovery has been slow…..but yet there is a bright spot….China….
the UK’s Guardian is reporting:
The Chinese economy returned to double digit growth in the fourth quarter, with a jump of 10.7% year-on-year, but inflation is creeping up again amid fears of overheating.
Although the fourth quarter GDP figure was slightly below analysts’ expectations, it was the fastest for two years and a marked increase on the previous quarter’s 9.1%. It took 2009′s growth to 8.7%, outstripping the official growth target of 8%, the level some believe essential to create enough jobs to match growth in the labour force.
“China has become the first, on the whole, to achieve recovery and stabilization in its economy,” Ma Jiantang, commissioner of the National Bureau of Statistics, told a press conference in Beijing. But he said China would avoid major adjustments to economic policy given the “uncertainties” it still faces and a weak global outlook.
So, what is China doing right? In the sense that they are showing a steady growth in their economy…..
ADDENDUM: I have seen a reason for this success (?)…….at least according to the AP:
Bank of China plans to sell up to 40 billion yuan ($5.8 billion) in bonds to replenish its capital and meet government standards following a record surge in lending last year amid Beijing’s stimulus measures, a state-run news agency reported.Regulators have warned some banks that they have fallen below minimum capital requirements after handing out some 9.5 trillion yuan in loans last year. Banks are expected to scale back lending to roughly 7.5 trillion yuan in 2010.
China’s banking industry is regarded as the healthiest of any major economy because institutions avoided the mortgage-related turmoil that battered Western lenders.
Beijing hopes cooling the pace of lending will keep its economy growing without creating inflation and overheating. Other nations are counting on that growth and a healthy demand from China for their goods for their own recoveries.
For more than 60 years the Middle East has been a powder keg just waiting for the right fuse to ignite it…..both sides of the Israel/Palestine issue have done very little actually help the prospect of peace and yet there is always the hope that these conflicting players will come to their sense and find a way to ‘give peace a chance’……
The Jerusalem Post is reporting:
Hamas has accepted Israel’s right to exist and would be prepared to nullify its charter, which calls for the destruction of Israel, Aziz Dwaik, Hamas’s most senior representative in the West Bank, said on Wednesday.
During the meeting in Hebron, Dwaik stressed that other Hamas leaders, including Damascus-based leader Khaled Mashaal and Gaza Prime Minister Ismail Haniyeh, have voiced support for the idea of establishing an independent Palestinian state within the pre-1967 boundaries.
Asked whether he might be condemned as naïve for believing Hamas, Abrahams said, “People might say that I’m naïve, so let them. But I’m prepared to give them [Hamas] a chance because I’ve got faith and confidence in Dwaik and Haniyeh. We can’t allow 1.5 million to be festering in the Gaza Strip while the majority of them are good and well-educated.”
Abrahams said that his decision to engage Hamas was aimed at “preventing bloodshed on both sides.” He said he was encouraged by the massive support he found among the Jewish community in Britain for the idea of talking to Hamas.
I for one would like to believe that peace is possible….but I have seen many a good idea go down in flames…shot to pieces by one side or the other…..unfortunately the conflict has become an institution for both sides…a way of life that will be hard to break…
For now, it looks promising but I have been sadly disappointed too many times to think it is a settlement that all can live with in the future…..