Thursday, June 23, 2011

Washington's Blog

Washington's Blog: "In 'Bernanke Admits He’s Clueless On Economy’s Soft Patch', Forbes blogger Agustino Fontevecchia notes:

Brutally honest, Bernanke admitted that he had no clue what was actually causing the current fragility in the U.S. economic recovery. While the FOMC statement assigned blame outside of the U.S., pointing at Japan along with rising food and oil prices, Bernanke was put on the spot by a reporter who noted the inconsistency behind that explanation and a lowering of long term forecasts. Bernanke took the hit, admitting only some of the factors were temporary and that he didn’t know exactly what was causing the slowdown, but that it would persist. “Growth,” said Bernanke, “will return into 2012.”
Specifically, Bernanke said today:

We don't have a precise read on why this slower pace of growth is persisting.
Well, it is obvious to anyone who has been paying attention what's causing the slow down, and if Mr. Bernanke doesn't know, he should be fired."

George is ripping the Fed today. The post goes on to quote numerous warnings from the BIS and others to the Fed before the crisis that things were getting out of hand--warnings the Fed chose to ignore. Why? Because its Wall Street controllers were making gobs of money from the risky and often fraudulent practices it was condoning.

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