It’s been clear for months (years, for those of us who have always been skeptical of bureaucrats’ claims to be able to manage the American economy) that the Fed is getting broadsided by the shear massiveness of the economic downturn. Anyone with half a brain could know the credit bubble was coming. Why didn’t they?
My wife and I sold our house in 2005 and paid cash for a bigger one in another state, not because we were geniuses, but because it was obvious to the common man that there was a huge bubble about to burst. Mortgage loans were flying off the shelves like nobody’s business, inflating the values of real estate everywhere. There were people talking about it, but the lamestream media sure didn’t cover them.
Did I know how bad it was going to get? No. But I could sense it was going to get ugly, and a lot of other Americans did as well.
So why is the Fed increasingly getting broadsided by the crisis and continuing to be “surprised” by how poorly the so-called “recovery” is taking hold? I think it’s because they’ve been blinded by ideology. They truly believed they could play god and manage the American economy, and now that the economy is spinning out of control, they are realizing how big a mess they created.
Okay, maybe that’s wishful thinking. Don’t expect apologies and repentance anytime soon from the leading lights of Keynesian economics.
But maybe, just maybe, the Fed will start acting with more humility and let the invisible hand of the free market solve our economic woes. I know, it’s a long shot.
Check out: Traders Freaking Out Over Wall St. Report on the Fed
The Fed is getting broadsided by the economy
By Option Trading Blog on August 24th, 2010
It’s been clear for months (years, for those of us who have always been skeptical of bureaucrats’ claims to be able to manage the American economy) that the Fed is getting broadsided by the shear massiveness of the economic downturn. Anyone with half a brain could know the credit bubble was coming. Why didn’t they?
My wife and I sold our house in 2005 and paid cash for a bigger one in another state, not because we were geniuses, but because it was obvious to the common man that there was a huge bubble about to burst. Mortgage loans were flying off the shelves like nobody’s business, inflating the values of real estate everywhere. There were people talking about it, but the lamestream media sure didn’t cover them.
Did I know how bad it was going to get? No. But I could sense it was going to get ugly, and a lot of other Americans did as well.
So why is the Fed increasingly getting broadsided by the crisis and continuing to be “surprised” by how poorly the so-called “recovery” is taking hold? I think it’s because they’ve been blinded by ideology. They truly believed they could play god and manage the American economy, and now that the economy is spinning out of control, they are realizing how big a mess they created.
Okay, maybe that’s wishful thinking. Don’t expect apologies and repentance anytime soon from the leading lights of Keynesian economics.
But maybe, just maybe, the Fed will start acting with more humility and let the invisible hand of the free market solve our economic woes. I know, it’s a long shot.