Bernanke seems to be a nice guy, and I liked his initiatives to make Fed more transparent. He is just incompetent for the big job and must resign right away!
Let's look at his scorecard:
- Heathy Growth of the US economy: He gets an F-. The economy is in a recession, and will be for a long time because his inaction last year and messy, panic moves this year. He bailed out the Bear Sterns last Friday. Is this guy a Socialist for wealthy people?
- Low inflation: He does better, gets an F. Whatever the inflation numbers the government released, just ignore them. I'm paying 20-30% more each month for everything that I eat and use. How much more do you spend each month? I don't even go out for dinner anymore.
- Sound underline economy structure for future growth: He gets an F again. Subprime mess. No problem. Just pumping more money into the money. Does this guy learn any lesson? Victor knows that if he got into trouble by doing something, he won't do it again. Learn something from a four year old.
- Economical opportunity for everybody: F-. (And he will argue that it's not his job!) The income gap between billionaires and low-income people is growing. Ben doesn't care and won't do anything.
Ben Bernanke acted cool last year, and missed by a mile. Now he is in a constant panic mood, dancing to the tunes of the Wall Street. He cut rate in a conference call after the Asian market tanked during the weekend. He will cut rate again tomorrow. I doubt that it will change anything.
Overall, he get an big F-. Time to find another job!
Just to be fair: Alan Greenspan is an egomaniac. He needs to shut up, for good.
(Oh well, what's all this has anything to do with our family blog? Good question…)
2 comments:
To be honest, I don’t know anything about money. But if Ben Bernanke can’t do his job, then he must go!
i don't know much about economics but i'm a big fan of freakonomics :) and a little search led me towards this article by freakonomics: The New head of the Federal Reserve, Ben Bernanke by Steven Levitt, October 30, 2005.
These words written down two years ago sounded somewhat comforting.
I have two thoughts on Bernanke running the Federal Reserve:
1) If I had to guess, the Chairman of the Fed has a lot less impact on the day-to-day performance of the economy than most people think. Although Greenspan has been elevated to God-like status, I suspect that he has been at least as lucky as he has been good. One of the most important lessons of modern macroeconomics is that it is probably impossible at the present time to “fine tune” it. More or less, you just want the Fed to stay out of the way and not totally botch things. There is mounting evidence that the Great Depression (and maybe also the stagflation of the early 1970s) was due in large part to policymakers following exactly the wrong course of action.
2) With that in mind, I think Bernanke is a great choice to run the Fed. He has an enormous appreciation of the history of monetary economics and past failures of Fed policy (see, for instance, this book he has written on the Great Depression). But at the same time, he is not an egomaniac who will pursue dangerous policies because of illusions of grandeur.
Post a Comment