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5 Responses to “Big Wildcard: Can Bernanke Stave Off a Recession?”

  1. chartist says:

    when the hell did they repeal the business cycle? How the hell can anyone stave off a recession?

  2. Lee Adler says:

    The Fed has bought more paper but ECB has done more lending. ECB balance sheet is 50% bigger than Fed (in $ terms). But that doesn’t mean that either faces constraints. They can both move to expand.

    I don’t know if I can post a chart but let’s try.

    or http://twitpic.com/aria59

  3. constantnormal says:

    “Are you a god?”

    I am reminded of the scene in Ghostbusters, where Ray (Ackroyd) confronts Gozer and says “… as a duly appointed representative of … blah, blah, blah”, and Gozer responds with “are you a god?” (you remember that scene) … that’s pretty much how I see Bernanke’s being able to stave off a recession.

    He can alter the timing and the severity of it, but if it has any sort of oomph to it at all, he will not be able to prevent it. I suspect that his actions have already delayed it about as far as he is able to, in the absence of the Fed’s various spins of QE, we probably would have entered the next recession early this year.

    His goal, however, is not to stave off the next recession, only to delay it past early November. The the “independent” Fed’s job will be done, at least in the eyes of the White House.

  4. Chief Tomahawk says:

    Kewl! Zero commercial breaks in that interview. Good stuff. Now, if The Big Picture Conference would just throw in a t-shirt with the ticket price…….

  5. What’s the defense budget for the last 3 years?

    That’s about the amount of paper the Fed has created on their books. A good portion of that created money is recycled into paying off bankers who own mortgages on overvalued properties that Wall Street levered …..

    Think of it this way … the Fed is merely trading sovereign currency for national defense – a good use of sovereign currency….

    The rich don’t want to pay for it anymore, let the Central bank trade sovereign dollars for security…