Tuesday, December 09, 2008

"Should Obama reappoint Bernanke in 2010?"

Asks the Mortgage Insider. Of course not. One reason? This (from a New Yorker profile):
In 1999, the height of the tech stock bubble, Bernanke and a colleague gave a presentation at a conference, arguing that the Fed should “ignore bubbles and stick to its traditional policy of controlling inflation.
Bubbles cause huge misallocation of capital. It also creates winners and losers in a completely random fashion. Or worse, since the naïve investor is usually the loser when a bubble expands and then pops.


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