Thursday, February 28, 2008

The Donkey: Greenspan

Just in case you still don't understand, this from Ritholtz, as he writes a reality-based speech for Ben Bernanke, which will NEVER be delivered:

Following the dot com implosion, my predecessor at the Fed slashed rates to a generational low of 1%; the FOMC then kept rates at 1% for over a year.

While that re-inflated the economy, it also set off a shock wave of inflation unseen since the 1970s. Houses doubled in price, Oil is up 5 fold, food stuffs have tripled, and the dollar has collapsed. Gold is at multi-decade highs.

...The weakening dollar -- now at levels last seen in the 1960s -- is forcing all dollar denominated commodities higher.

Greenspan's answer to everything was "mo' money, man." Greenspan's penchant for printing USD's will be legendary, although it will more than likely earn him a place in the Hall of Shame from our children and grandchildren.

Not even the politicians, now trying to buy re-election with their bogus "rebate" can out-whore Greenspan's opus. But rest assured, that "rebate" will only further devalue the USD and increase inflation--not to mention the tax-bill downstream.

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