The Chairman of the Federal Reserve Board of Governors, Ben Bernanke, today stated the obvious. Our economy sucks and there is no end in sight. He expressed The Fed’s concern about inflation.
It is baffling that The Fed cannot see the obvious; unless The Fed can magically control energy, food, and health care prices, there is not a damn thing The Fed can do about our current inflation. Quite properly, inflation is The Fed’s concern when based on a booming economy fed by low interest loans and easy credit. However, The Fed cannot control inflation in a stagnant economy fed by the rising cost of energy, food, and healthcare. Bernanke needs to quit trying to repair what he has no tools or talent to fix.
The prices of houses are DOWN. Automobile prices are DOWN. The values of our stock portfolios are DOWN. The dividend yield from our savings is DOWN. Employment is DOWN. The purchasing power of our wages is DOWN. Our ability to get a loan is DOWN. If Ben Bernanke believes that a wildly inflationary wage increase is heading our way, he is insane. When sales are DOWN in a depressed economy, just what INFLATION is it that concerns The Fed?
Part of the reason that we have boom and bust economic cycles is because The Fed over-corrects on both the downside and upside. Unless he wants to step forward to accept a large chunk of the blame for our economic mess, Ben Bernanke needs to have a good old-fashioned cup of “Shut the fuck up!”