Thursday, February 17, 2011

Ben Bernake explaining monitary policy

I am sure many will not find anything new in this speech and answers. But it makes a difference to me when someone interprets what Bernake is trying to do vs Bernake explaining what he is trying to do.

Conclusion stays the same: We have a very powerful force....the Federal Reserve trying to prop up prices of any/every asset.....the only reason they are able to do so is because lenders are still willing to lend to US at a cheap interest rate and US still has a AAA credit rating. How long that will continue..... nobody knows.

I can't be an expert at economics but when such a powerful force is out there to create inflation then that is what will occur......and as Charlie says you can never just do one thing in financial markets..... there are always consequences...

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