I have a thing against people in ivory towers. At best, they make incredibly boneheaded decisions, and often do. Or at worst, they entirely fail to see the iceberg before the ship crashes. All the while they hide behind their fancy degrees, spouting a ton of jargon to make themselves look a lot smarter than they actually are.
Ben Bernanke is one such person. The man really gets on my nerves. As the former Chairman of the Federal Reserve, he headed up the Fed during the worst crisis of most of our lifetimes. And not only did he not see it coming… he made it worse by pursuing reckless policies that have led to the worst economic recovery in 70 years.
Just before the huge collapse in 2008 that took down everyone from Joe Six-pack to the Lehman Brothers, the Federal Reserve was touting “green shoots” recovery propaganda. Prior to that it was the “Goldilocks Economy.” Neither too hot nor too cold. Then wham!! Stock prices collapsed and people were forced out of their homes.
Didn’t see it coming, did you, Ben?
So when earlier this week Bernanke penned a piece for the Wall Street Journal called “How the Fed Saved the Economy,” I wondered: Does this guy live in the real world?
He says the economy has nearly reached full employment. So why are everyday Americans still struggling to find good paying jobs? Sure, the unemployment rate is 5.1%, but the labor force participation rate is the lowest in 38 years! And real household incomes are down double digits over the last 15 years.
Then for him to say inflation is low?! Have you been to the grocery store lately? The price of nearly everything has skyrocketed. Oh, that’s right, the Federal Reserve doesn’t include commodities like food and energy in the inflation rate. You know, just the stuff we use every day to live!
Since he has no credibility in recognizing and taking action to curb the crisis in the first place, I’m not sure why anyone cares what he thinks anyway. He should go back to his ivory tower and write books for other would-be “intellectuals.”
The former chair included, the Federal Reserve has no credibility. While it’s still going on about raising interest rates as if everything’s fine and dandy, we may already be in another recession.
Just consider the evidence: The recent jobs number bombed. Economic growth has been downgraded globally. On top of that, the U.S. stock market is the second most overvalued in the world when looking at long-term earnings trends. How does the Fed think it can possibly raise rates??
Good luck with that. Fool me once, shame on you. Fool me twice, shame on me. Protect your wealth and don’t listen to these so-called brilliant economists who miss predicting every crisis beforehand and only make matters worse with their reckless policies.
John Del Vecchio
Editor, Forensic Investor