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"If we were to tighten policy, the economy would tank," says Ben Bernanke wrapping up day one of...

"If we were to tighten policy, the economy would tank," says Ben Bernanke wrapping up day one of his Humphrey Hawkins testimony (tomorrow, the Senate). John Hilsenrath notes the striking change from the June FOMC policy statement - which said downside risks had diminished - to today's testimony which clearly highlighted the downside. "A dovish tilt towards easier money." Hilsenrath and FTAlphaville also both note another dovish tilt, the re-emergence of the "D" word - deflation.
Comments (27)
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    Given current inflation of around 1% the Feds should increase the amount of QE instead of decreasing it.
    17 Jul 2013, 01:33 PM Reply Like
  • tunaman4u2
    , contributor
    Comments (2744) | Send Message
     
    I've been saying this for the last 6 years... its stimulus & printing forever or tank. They are stuck & always will be. Congratulations its the new normal, perma stimulus

     

    What makes a coke addict stop? Death... and thats where we are headed period. How much QE will actually cause that & when? I dunno but it WILL happen, history says its 100%
    17 Jul 2013, 01:33 PM Reply Like
  • mobyss
    , contributor
    Comments (1849) | Send Message
     
    Coke is high-class.

     

    This is a back-alley crack addict market.
    17 Jul 2013, 01:40 PM Reply Like
  • wapiti
    , contributor
    Comments (698) | Send Message
     
    In other words suckers, the market is artifically inflated and fundamentals don't matter! At least not now....There will be hell to pay ONE day but after I'm gone so the next Chairman can deal with my mess.. just like greenspan did to me
    17 Jul 2013, 01:33 PM Reply Like
  • montanamark
    , contributor
    Comments (1434) | Send Message
     
    hilarious after 5 years of pumping trillions and the nonstop cheering from the "media" about a recovery, he admits that if they let off the gas, the whole thing will "tank"

     

    does this sound like a stable, real recovery - LOL
    17 Jul 2013, 01:36 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    Imagine you are a heart patient and need medication. You take it for 5 years and you still have your heart condition. Do you stop taking the medicine?
    17 Jul 2013, 01:39 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2485) | Send Message
     
    And take into account the huge drag the fiscal side of the equation is having. The fed has its foot on the gas and yet Congress and the President are standing on the brakes.
    17 Jul 2013, 01:59 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    I don't think the President is standing on the brakes.
    17 Jul 2013, 02:05 PM Reply Like
  • montanamark
    , contributor
    Comments (1434) | Send Message
     
    this is no heart disease - its drug addiction; if after 5 years the addict has not beat his addiction, do you keep pumping him full of drugs

     

    bernanke is the dealer - he and the fed created the problem to begin with so no one should praise him for addressing it
    17 Jul 2013, 02:14 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    It doesn't matter who created the problem. I care more about the solution and the solution is more QE. If you disagree, tell me how less QE would help?
    17 Jul 2013, 02:30 PM Reply Like
  • montanamark
    , contributor
    Comments (1434) | Send Message
     
    it DOES matter. why would your first choice for a solution to be the person who caused the problem? who elected a private banker to hijack equity markets? why dont you tell us what QE has done to help main street or the real economy? QE is for bankers and to allow our insane government to spend wildly. it is killing jobs and the real economy and taking away incentive for real business
    17 Jul 2013, 03:00 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2485) | Send Message
     
    The President certainly isnt doing anything to help economic growth. And I believe he did sign the sequester into law.
    17 Jul 2013, 03:07 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    Perhaps you forget the sequester debate and what the President's position was on that.
    17 Jul 2013, 04:44 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2485) | Send Message
     
    O so he didnt put his name on the dotted line? That was a different Barack Obama?
    17 Jul 2013, 09:40 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    I m not going to get drawn into a political argument but as I remember it, it was a compromise that was reached. Obama _conceded_ the sequester, he did not endorse it.
    17 Jul 2013, 09:51 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2485) | Send Message
     
    Yes it was not his idea, yes it was a bad idea, and yes it was an idea he did not like. But when push comes to shove he signed that idea, which he admitted was a bad idea, into law. Signing a bill into law that cuts spending by that amount is, in my opinion, pumping the brakes of the economy. His idea or not, it needed his signature to happen, since I seriously doubt the Senate would have voted to overturn the veto
    17 Jul 2013, 11:24 PM Reply Like
  • wapiti
    , contributor
    Comments (698) | Send Message
     
    Like car financing after 9/11, once they took it to 0%, they can't sell cars without it. Crack is some addictive stuff, huh Ben?
    17 Jul 2013, 01:38 PM Reply Like
  • mobyss
    , contributor
    Comments (1849) | Send Message
     
    QE will never end.

     

    Oil to $140+

     

    Gold to $1800+

     

    S&P to whatever Bernanke can push it up to...
    17 Jul 2013, 01:39 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    Gold and oil are going nowhere with 1-1.5% inflation. S&P on the other hand ...
    17 Jul 2013, 01:41 PM Reply Like
  • mobyss
    , contributor
    Comments (1849) | Send Message
     
    Oil going nowhere? How about up 10% in the last few weeks after Bernanke panicked (from a 5% market drop) and admitted that QE will probably never really end?
    17 Jul 2013, 02:49 PM Reply Like
  • Macro Investor
    , contributor
    Comments (8630) | Send Message
     
    That was because of Egypt. Yes, there will be spikes.
    17 Jul 2013, 02:50 PM Reply Like
  • Jack Rice
    , contributor
    Comments (841) | Send Message
     
    So, Bernanke "admitted" QE would never end? The bond market seem to have heard differently. I'm sure they'd be most grateful for your setting them right.
    18 Jul 2013, 12:22 AM Reply Like
  • wapiti
    , contributor
    Comments (698) | Send Message
     
    yea, but we're ALL so smart with our Phds from IVY League schools...we know what we're doing...Trust us!

     

    idiots!!
    17 Jul 2013, 01:41 PM Reply Like
  • wapiti
    , contributor
    Comments (698) | Send Message
     
    Montanamark, not to mention killing savers and people who played by the rules and now they can't get a CD or T-bill to cover the monthly H2O bill. BEN has forced everyone into the stock markets now(he first did the bond market and they got KILLED) and this too will end UGLY for conservative RISK AVERSE savers and investors. All for the sake of the consumer driving the economy. Why save? U don't get paid to! Spend ,spend spend and the Government will bail u out with food stamps, housing, phones, debit cards,etc. What a sham and shame!
    17 Jul 2013, 03:07 PM Reply Like
  • Mike Maher
    , contributor
    Comments (2485) | Send Message
     
    There are a lot of political comments on here and not a lot of rational economic arguments. This is why the Fed is by definition not a political body.
    17 Jul 2013, 03:11 PM Reply Like
  • MechEngineer
    , contributor
    Comments (9) | Send Message
     
    Heroine more like it, Mr. Market is a straight up Juuunkie maaan.
    17 Jul 2013, 04:00 PM Reply Like
  • into dark shadows
    , contributor
    Comments (323) | Send Message
     
    O.M.G.!
    Excuse me lord,
    but the "D" word?
    Really?
    The so called "D" word has been nipping at the heals of our bubble after bubble and still one last bubble the world over!
    You have to understand that we are in a DEFLATIONARY environment, we have been since the first bar code scanner was tried and installed in Grand Unions headquarter / flagship supermarket circa 1978 / '79 ish...
    The slack in today's economy is massive, productivity has a nasty little trade off for social media / cell phone / chip makers,etc..You create a society that can literally have anything, but at what cost economically? Culturally?

     

    The deleveraging cycle that is STILL needed today,(sorry to jump to warp drive) but DEFLATIONARY contractions seem to be some unknowable bogey man only Ben Bernanke and his super powers can understand!
    Fallow money? Velocity of money? Ask the magic 8 ball!
    Don't you know, because he's supposed to know so much about said DEPRESSION and period!
    It's a shame how poorly we have acted, our so called elected officials who are supposed to have the countries back in times / years of crisis and turmoil.
    But we elect and reelect sad, poor examples of what centuries ago were true American Patriots!
    Where is our next George Washington?
    Bernanke?
    History will judge this massive 100 year in the making, progressive experiment an utter disaster!
    Elliott Spitzer?
    Al Sharpton?
    Anthony Weiner?
    History, in another time would have run these men out of town if they were lucky.
    If not, well just think about boiling hot tar and a pillow full of feathers, they deemed the punishment fit the crime, in such simpler times.
    We have fallen so very short of the standard they once established and nurtured.
    God save the Republic!
    17 Jul 2013, 09:03 PM Reply Like
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