mundame
10-15-2008, 12:51 PM
Reuters 10/15: Market tumbles further on Bernanke comments (http://www.reuters.com/article/newsOne/idUSTRE49B3PW20081015)
Bernanke says U.S. economy facing big threat (http://www.reuters.com/article/newsOne/idUSTRE49E6Y820081015)
As of this moment, the Dow is down -501.
Bernanke was pretty pessimistic!
"By restricting flows of credit to households, businesses, and state and local governments, the turmoil in financial markets and the funding pressures on financial firms pose a significant threat to economic growth," Bernanke said.
This is unusual for panics and crashes, because usually officials use ritual incantation: "The fundamentals of the economy are sound" (1929 and 2008). John Kenneth Galbraith amuses his reader in "The Great Crash: 1929" with a couple pages of officials and economists and bankers saying how wonderful everything is and how all the indicators are just on the point of turning up, from 1929 right through the low in July 1932, after which they pretty much gave up. Then it DID start to turn up!
Bernanke is not doing this. He's just laying out the truth and letting the markets suit themselves. I like this.
It is clear to all that he is hinting for another Fed rate lowering. He's already down to 1.5%!!!! He can hardly go much lower! I suppose he'll go down to 1% later this month, as an emergency if things get weird again.
I think Bernanke is a good man; he's of course a scholar of the Great Depression, so he REALLY knows. I think we're in trouble, but he's as good as it gets for not making it worse.
Bernanke says U.S. economy facing big threat (http://www.reuters.com/article/newsOne/idUSTRE49E6Y820081015)
As of this moment, the Dow is down -501.
Bernanke was pretty pessimistic!
"By restricting flows of credit to households, businesses, and state and local governments, the turmoil in financial markets and the funding pressures on financial firms pose a significant threat to economic growth," Bernanke said.
This is unusual for panics and crashes, because usually officials use ritual incantation: "The fundamentals of the economy are sound" (1929 and 2008). John Kenneth Galbraith amuses his reader in "The Great Crash: 1929" with a couple pages of officials and economists and bankers saying how wonderful everything is and how all the indicators are just on the point of turning up, from 1929 right through the low in July 1932, after which they pretty much gave up. Then it DID start to turn up!
Bernanke is not doing this. He's just laying out the truth and letting the markets suit themselves. I like this.
It is clear to all that he is hinting for another Fed rate lowering. He's already down to 1.5%!!!! He can hardly go much lower! I suppose he'll go down to 1% later this month, as an emergency if things get weird again.
I think Bernanke is a good man; he's of course a scholar of the Great Depression, so he REALLY knows. I think we're in trouble, but he's as good as it gets for not making it worse.