Did Ben Say Anything Different?

Discussion in 'Economics' started by AAAintheBeltway, Jul 11, 2013.

  1. I'm curious. Bernanke's remarks in the news conference after the last Fed meeting created a massive selloff, even thugh he seemed to be pleading at the time that he wasn't saying anything negative.

    Now last night he said what I assume to be essentially the same thing, and we get a huge rally.

    Was there some special wording last night that I missed?
  2. Tsing Tao

    Tsing Tao

  3. Josef K

    Josef K

    No, apparently he didn't say anything different. I have yet to find any quotes regarding him changing his mind on QE. All I can see is that people are taking his use of the generic phrase "highly accommodative monetary policy" as meaning that tapering will not occur later this year. That's a non sequitur.
  4. Tsing Tao

    Tsing Tao

    How can you possibly think this way? Do you work for the Fed?
  5. Josef K

    Josef K

    Point out to me anything that was stated that indicated a reversal of policy. You can't, because all that Bernanke did was speak in the general terms that he always does in order to leave open his options. Back in June, he said that if future economic data turns out as expected, then tapering will begin. If, then. Nothing he said yesterday changes that. People are getting giddy over nothing.
  6. I have long thought that Bernanke was one of the worst Fed Chairmen in history. If he didn't create the financial crisis, his inept handling of rate policy at the time certainly contributed to its severity. We had several spirited arguments at that time here about that subject.

    Nothing has happened since to make me change my view. Bernanke had no reason to run his mouth endlessly in the press conference after the last Fed meeting. As Steve Leiseman noted, it seemed to indicate to market participants that there was more to the Fed's statement than was apparent, and thus triggered the selloff. What should have been a nonevent triggered a violent bond market reaction, suggesting a Japan-style loss of control of the very markets Bernanke spent months rigging.

    Now this bumbler tries to undo his misstep and the result is a sharp break in the dollar, resurgent commodities, which acts as a tax increase, ie the last thing we need, and more confusion.

    I don't know who replaces him, but it is hard to believe they won't be an improvement. Hopefully, it will be someone with a far more modest view of their role and a far greater appreciation of market dynamics.
  7. I see the market is jumping. Did he spout off again?
  8. I think Greenspan should be brought back. He's made more sense since he left than Bernanke and the possible next Fed head (Yellin).

  9. "Highly accommodative policy" has always been the case since Lehman. The only difference is ultra accommodative vs. less ultra accommodative.
    I think it's market's interpretation of Bernanke.
    There's the stock market interpretation, which is different from the bond market's interpretation, which is different still from the precious metals markets' interpretation. Just compare prices now vs. 6/19.
  10. Santelli today, 7/11/13

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    #10     Jul 11, 2013