Here's Bernanke's testimony in October of 2005 - at the very height of the speculative and criminal madness of the Late Great Housing Bubble:
"House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals, including robust growth in jobs and incomes, low mortgage rates, steady rates of household formation, and factors that limit the expansion of housing supply in some areas.
House prices are unlikely to continue rising at current rates. However, as reflected in many private-sector forecasts such as the Blue Chip forecast mentioned earlier, a moderate cooling in the housing market, should one occur, would not be inconsistent with the economy continuing to grow at or near its potential next year."
And yet here's what Bernanke should have known, and simply said:
"The US and world housing markets are caught up in a speculative and fraud-filled madness, one that will come crashing down in a historic way, with many markets falling 30%, 40%, 50% and more. Housing's historic fundamentals led by the price-to-income and price-to-rent ratios have become significantly and obviously distorted by massive criminal mortgage fraud and rampant speculation. This will all end soon, and in tears."
Maybe they should put "Manias, Panics and Crashes" on the required reading list at Harvard and MIT. Pumping out ivory tower real-world-ignorant graduates like Bernanke (and Greenspan) is just such a shame.
June 15, 2008
Isn't it amazing that Harvard-educated smart guys like Ben Bernanke didn't see the Housing Ponzi Scheme and Fraud Fiesta for what it truly was?
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What's more likely: Bernanke and Greenspan both being dumb as posts, or both of them being very smart people who are completely in the vest pocket of the banking industry?
Why do you think the Fed gave JPM the money for the Bear Stearns deal? Why was Greenspan telling people to take out ARMs when interest rates, which he controlled, were at historic lows?
Be serious. They're not dumb, they're EVIL. All their actions further their goal: to redistribute America's wealth from the middle class to those that run the big investment banks.
It's astounding that people continue to obsess about what Bernanke and Greenspan SAY while ignoring what they DO.
Hey this is like the roaring 20's - everyone do the Charleston!
what he says is true but only to an extent since-- problem is, the actual wealth distribution didn't let a lot of folks pt in.
the clinton's, for example, made $100 million plus in a very short time period.
I mean, isn't it OBVIOUS from this picture???
Benny was busy smoking the Chronic every day for years, and really has no concept of the real world and how it works.
Why should he slow down now??
You don't get to be Fed Chairman unless they have you by the balls.
He does exactly what he is told by the Shadow Government.
Didn't Enron's Skilling, and GW go to Harvard Business School?
you assume he is ignorant. I interpret his speeches as a tool in increasing the profit margins of his constituency big banks and wall street firms. why is cnbc so biased? could it be they are owned by one of the largest financial institutions in the world G.E.
Clearly a Harvard education does not mean much in the real world where "theories" are nothing more than just "economical fiction(r)."
I'd also like to see how well anyone from Harvard could survive during a depression, war, etc.
They did Keith. They're not stupid. Greenspan was well aware of housing bubbles before he became Fed chairman. I wish I had time to dig up the references to his own documents and thesis right now but I don't.
It appears you have fallen for a common fallacy, especially for modern times. Education has nothing to do with intelligence! Most of the more successful people I know did not finish college (and no they are not real estate agents!). I did finish college, but looking back I question whether or not it was necessary.
Just because somebody went to an Ivy League school does not make them intelligent. I have a guy working for me who is a Harvard MBA. He is a decent worker, but as I said he works for me, despite the fact I am younger, with less education and experience.
So please don't be so foolish as to believe a good school or a couple fancy acronyms by your name mean you are automatically intelligent.
Thanks.
PS: Bernanke helps prove my point because he is a grade A moron!
This "Harvard grad" issue is not uncommon. A contact of mine who comes from a family of great wealth is a Harvard MBA grad. In 2006 he closed his first hedge fund due to crappy performance. Then he took down the sign on the wall, changed the name of the hedge fund, got another partner, and some more naive investors, and now he's back at it, under a different hedge fund name. And he still has no idea what he is doing, as far as managing risk or making significant risk-adjusted returns. It is entertaining to see him carry on like this...
Most (not all) wealthy people are too detached from reality. That's just the way it is. They think that there is still a "middle" class.
People are not allowed to get anywhere near power unless they have proven they will do as they are told.
Obama included.
He didn't have a choice. Unless you wanted to see a wave of bank failures and people pulling their money out in pure panic he was forced to keep the banks stable. Everything we see now is a massive consequence of this. The powers that be knew this and they all signed off anyway - this includes the ECB by the way.
-Mike
These Ivy Leaguers are book smart. They are not street smart and don't work in the real world.
Look at his picture....he reeks of stupidity.
I agree. Do you see those squiggly lines rising from Bernanke in that photo? Those are stupidity fumes. He is so stupid you can smell him before he enters a room, his pungent aroma precedes him.
His beard? That's a stupidity mask that he grew to help him pass his doctoral thesis - it worked, but just barely.
If you take a stethoscope to Bernanke's skull you can hear old-fashioned organ-grinder music - that's the sound-track of stupidity. Every once in a while his brain puts out a sound like a school-bell ringing - that's when Bernanke goes crazy and gets an idea.
I don't think I have full faith in this man.
yeah right -- they didn't see it coming. Hogwash!
What's that old saying...it is impossible to awake the man who pretends to sleep.
charlottemom
They know about every single bubble. They just let it happen, that's the reason our pathetic republican presidents (Bush and Reagan) chose them. They know how to hide the truth.
How come it's republicans that get to chose who we elect for the supreme court, fed, cia and just about everything else?
Dny
Many of them jumped out of windows
during the depression ... the same could happen again.
Owner Earnings said...
Clearly a Harvard education does not mean much in the real world where "theories" are nothing more than just "economical fiction(r)."
I'd also like to see how well anyone from Harvard could survive during a depression, war, etc.
June 16, 2008 2:14 AM
Harvard educated smart guys? Nah, those guys are no better than prostitutes. The only difference is that they give brain instead of a two minute trick. That's why they are called intellectual prostitutes.
the real foreclosures of OC
http://www.ocregister.com/ocregister/money/article_2067427.php
BANKS OWN THE FED---It's all shrouded in secrecy, but the ultimate bottom line....
"Don't bite the hand that feeds you"--is Ben's guiding light.
Mr. David Halberstam, himself a Harvard grad, wrote a book, The Best and The Brightest. It was a history of how all these supposedly smart people got us into Vietnam. Lyndon Johnson was smarter than any of them, but let his feelings of inferiority allow these geniuses to take him down a path.
Halberstam's book was a kind of uptake on the story of the emporer's new suit.
Paul Volcker went to Princeton, where Bernanke was a professor, and also to Harvard. We need another like him.
There were a lot of smart people at Enron, at LTCM, and at Bear Stearns. So wrapped up in their sophistications that they began to ignore fundamentals.
The only dummies are us ... that we put up with this political BS from these greasy pigs for so long.
Well, a new chapter in our history is beginning where more and more US citizens move towards the poverty-line, and it's due largely in part to essential commodity items (and services such as healthcare) becoming more and more expensive for US citizens, as the dollar tanks.
In only 8-years this most awful of all administrations has created debt that our children, and chldren's children, will never pay off.
Jim Rodgers was correct in saying ... "[The Fed has given up on the dollar.]"
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