So far Ben hasn’t screwed anything up, let’s see if he screws things up before decide he is an idiot. A few months ago I read some of his writing where he felt that the depression could have been averted or shortened with liquidity and not an interest rate reduction. He has also been labeled Helicopter Ben because dropping liquidity on the market like helicopter drops of money is one of his favorite tools. market went to crap a few weeks ago, financial engine seized and he did just what we thought he would, temporary liquidity injections but no drop in the fed funds rate. In studying him further, I draw the conclusion that he is not a fan of asset bubbles and the one he is facing he inherited. Let’s give him a few weeks to see what he does, you may be suprised and he just may stay on the sidelines as far as the rate goes, or it may go down a tad but not for too long. A half point in the fed funds rate isn’t going to stop the deflation in the housing bubble anyway.
