This Is Your Market On Deflation
“Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.” Ben Bernanke on the occasion of Milton Friedman’s 90th .. read more
Weekly Economic and Market Review
The market got exactly what it expected last week and the result was another leg higher in a rally built on two dubious assumptions: gridlock is good and the Fed can fix what ails the economy. The mid term elections delivered control of the House of Representatives to John Boehner and the Republicans while the .. read more
Weekly Economic and Market Review
Is there a bubble in bond land? That’s become the hot question of the moment with everyone from Jeremy Siegel (yes) to Randall Forsyth at Barrons (no) offering an opinion. I was even quoted in an article this week at CNN Money concerning the present state of the bond market. Goodness knows, if reporters are .. read more
Deflation
The Federal Reserve, backed by almost every mainstream economist, is determined to prevent deflation. In fact, Bernanke, in promising Milton Friedman that he wouldn’t repeat the mistakes of the Depression era Fed, was essentially promising that he wouldn’t allow deflation. Why is he so afraid so deflation? The basic answer to that question is that .. read more
How’s Bernanke Doing?
Ben Bernanke famously apologized to Milton Friedman saying: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again. Bernanke was referring to Friedman and Schwartz’ book “A Monetary History of the US”, in which they explained that the Great Depression, and the deflation that .. read more
Robert Higgs Bursts the Deflation Bubble
The news stories about deflation have been mushrooming again much as they did back in the early 2000s. Back then, Ben Bernanke was a member of the Fed but Greenspan was still chairman. Bernanke convinced Greenspan that deflation was imminent and that it had to be stopped. Oh my God! We can’t let prices fall! .. read more
Will China Increase Gold Reserves?
I don’t know how much faith to put in this report but if it is true, gold may about to make a move: According to a report published in The Standard, Hongkong, the Chinese mainland is seriously considering a plan to diversify more of its massive foreign-exchange reserves into gold. The newspaper, quoting official sources, .. read more
Why does the Fed Fear Deflation?
Back at the beginning of this century, the Fed (and Ben Bernanke in particular) became worried about deflation. When the tech bubble popped they were so worried about the potential for deflation a la the Great Depression that they overdid it and caused a housing bubble. But why does the Fed fear deflation? That fear .. read more
