Been saying this for a long time.
The reason I started blogging in the first place was the massive misinformation on economic policy coming out of the White House. We had been on the wrong path since the latter half of the Bush years (he was no spendthrift) and Obama took us right off a cliff.
Yesterday Ben Bernanke said,
The Fed has lowered interest rates effectively to zero and vowed to keep them there through the end of 2014 in response to those challenges, but Bernanke suggested there is little more the central bank can do.
“Monetary policy is not a panacea,” he said. “The long-term health of the economy depends mostly on decisions taken by Congress and the administration.”
I think he makes my point. It’s not tax cuts that are killing us. But no growth. The massive deficit and massive amount of regulation Obama has thrown at the economy has caused a vapor lock. We are stuck in the mud.
Get rid of Obama, change policy to pro growth, cut federal deficits and we will be okay.
In Senate testimony, Senator Corker from Tennessee asked a lot of questions of Fed Chair Ben Bernanke on the Volcker Rule.
In essence, Corker was asking broad questions about market making that have little or no relation to what I thought the Volcker Rule’s actual intent was. Corker was trying to build a case that the banks should be allowed to trade based on their market making capabilities.
I have a few perspectives on that to share. First, if the banks didn’t make markets, what would happen? If there was value to making those markets, someone would step into the void. I can recall in a trading pit when a big trader would retire, or a big trader would take a vacation people might ask, “Who will pick up the slack?” Without fail and immediately, someone would. Financial markets are highly competitive. If banks weren’t making markets someone would.