Despite the devastation of the Fed’s previous burst bubbles ... Bernanke still believes in the virtue of pumping. His current policy is to inflate another stock market bubble to cure the recession that resulted from the bursting of the housing bubble, which was itself inflated to counter the effects of the bursting tech stock bubble.
Does the story of the old lady who swallowed the fly come to mind? She eventually tried swallowing a horse, and we know how that ended.
It’s hard to decide who is more culpable for the strategy: Bernanke for selling it or the country for buying it.
-Peter Schiff, “There Was a Fed Chairman Who Swallowed a Fly”
UPDATE: “Ben Bernanke Has Never Gotten Anything Right” Peter Schiff tells a room including a panel of Federal Reserve officials. (They respond.)
It’s true. For example:
But weren’t Ben and his boss Alan right that there a nasty “savings glut” that caused the nice chaps all the problems ?