Its springtime and opening day of the 2012 Major League Baseball season is right around the corner.
Fans in every major league city in America have high hopes for a successful year culminating in the playoffs and ultimately a World Series championship.
However, every baseball enthusiast knows that if team failure has been a pattern of the past, changes need to be made.
More often than not those changes usually start by replacing the manager.
Just imagine the manager announcing to the media after finishing last in the division for the past several seasons, “OK, it’s going to be more of the same across the board, right down to the bat boy. No changes!”
Fans would be outraged.
Yet, Ben Bernanke has just stated that QE3 is on the way.
The high-frequency traders and mainstream media are ecstatic and the “wealth effect” will apparently be with us for quite some time.
Nevertheless, don’t hang the championship bunting just yet.
With Bernanke’s most recent pronouncement of more of the same comes continued rising commodity prices which means that for every dollar increase in equity wealth there is an equal or greater increased cost of food and energy.
In other words, if you like $4 gas you’ll love it at $5.
In addition, an employer’s ability or willingness to hire more people, even at reduced wages, will continue to be tested.
Real unemployment will continue to escalate as Bernanke remains clueless and states “There are a lot of things happening in the labor market we don’t fully understand.” However, what most people do understand and what Bernanke should comprehend but does not, is that if something isn’t working (QE1 and QE2) don’t continue with more of the same.
Every major league owner, manager, player, and fan knows and understands that if a team is not winning changes are needed, if not in personnel at least in strategy. Unfortunately, that message has not quite resonated with Chairman Ben.
Can he be removed?
No, though I’d fire him if I could, since like you, I’m one of the owners. A
self-proclaimed fan of baseball, Bernanke must believe that winning just happens and if you continue to do the same thing for a long period of time it will ultimately result in a championship ring.
Sorry Ben, it doesn’t work that way, neither in an economy nor on the playing field.
Just ask the Chicago Cubs.