Redstate

Posted at 6:53am on Jun. 10, 2008 Market Mover: Dealing With Higher US Inflation

Geithner Drops a Hint, Bernanke follows with a bomb

By blackhedd

A funny thing happened this morning as I was writing a story for you about Timothy Geithner’s important speech yesterday at the New York Economic Club: Inflation came back.

Geithner is the President of the New York Federal Reserve Bank, and his main topic yesterday was the gap between today’s innovative financial-market practices and the regulatory apparatus (including the Fed) that is supposed to keep markets stable.

This is a critical topic of great interest to policymakers around the world, and a consensus is growing that a “unified global framework” for financial regulation is needed. I’ll write a complete post about this subject later on.

But in the Q/A after his speech, President Geithner was asked (inevitably) about where the economy is going. He said that demand is getting softer, but he also said that the Fed will be watching inflation very carefully.

Federal Reserve officials always tread a very fine line in public statements because they know everyone will parse every comma for signals about the direction of interest rates. By emphasizing inflation over economic slowness, Geithner left an impression that they might head higher.

Keep reading…

Posted in Bernanke | Economy | federal reserve | geithner | inflation | Interest rates — Comments (9)/ Email this page » / Read More »

Posted at 6:27pm on Apr. 2, 2008 "That Was an Extraordinary Thing To Do"

"I thought about it long and hard"

By blackhedd

Fed Chairman Ben Bernanke testified in Congress today about his team's handling of the Bear Stearns collapse, story here.

I'm among the many people who have written at length about how the Fed formed an external entity funded with $29 billion, in order to purchase mortgage-backed securities from Bear.

Here's what the Chairman had to say about that part of the episode:

``That was an extraordinary thing to do, I thought about it long and hard,'' Bernanke said, referring to the funding. ``I hope this is a rare event, I hope this is something we never have to do again.''

I'm going to take Bernanke at his word on this. The Federal Reserve (unlike the Treasury, at various points in history) has never exhibited a taste for exceeding its charter to anchor the nation's money supply and its payments system.

Extraordinary times require extraordinary actions, from extraordinary men.

-Francis Cianfrocca ("blackhedd")

Posted in bailout | Bear Stearns | Bernanke | Economy | federal reserve — Comments (4)/ Email this page » / Read More »

Posted at 9:24pm on Jan. 14, 2008 Chairman Ben Bernanke on Economic Stimulus

"INCHOATE"

By blackhedd

Noted as a followup to my piece on Democratic proposals to stimulate the economy: Federal Reserve Chairman Ben Bernanke and House Speaker Nancy Pelosi had a sitdown today.

The subject was a package of legislative items designed to "stimulate the economy," which presumably means to forestall the recession that many people consider likely this year.

Pelosi's in favor. Bernanke made a few happy noises.

More...

Posted in Bernanke | Congress | Economic Stimulus | Economy | federal reserve — Comments (18)/ Email this page » / Read More »