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An economist's take on Fed's August 27, 2010 speech on economic conditions and monetary policy...

 

On Friday, Fed Chairman Bernanke delivered a speech concerning our economic conditions and monetary policy. The speech was given at the Federal Reserve Bank of Kansas City Economic Symposium in Jackson Hole (Wyoming).

 

I’ve taken his speech and reorganized it into the most important categories. But, here’s the bottom line…regardless of what the newspaper headlines said (many headlines focused on Bernanke’s assurances) Bernanke delivered dismal news – but you actually had to read the speech and not the spin. He admitted that the economy is weak and that the Fed didn’t expect the weakness, he told us that things will be better next year (we’re supposed to believe the Fed’s predictive powers are improving) and he discussed the tools that remain available to the Fed and made me realize that the Fed will simply be shooting blanks. This speech should scare the hell out of you. It does me.

 

Leeds on Finance, the August 30 column

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An economist's take on Fed's August 27, 2010 speech on economic conditions and monetary policy...     Leeds on Finance, the August 30 column

exactly.

because this is america and biting off more than one can chew through reliance on other people's willingness to also bite off more than they can chew, in order to facilitate your greed, is the america

An economist's take on Fed's August 27, 2010 speech on economic conditions and monetary policy...

 

On Friday, Fed Chairman Bernanke delivered a speech concerning our economic conditions and monetary policy. The speech was given at the Federal Reserve Bank of Kansas City Economic Symposium in Jackson Hole (Wyoming).

 

I’ve taken his speech and reorganized it into the most important categories. But, here’s the bottom line…regardless of what the newspaper headlines said (many headlines focused on Bernanke’s assurances) Bernanke delivered dismal news – but you actually had to read the speech and not the spin. He admitted that the economy is weak and that the Fed didn’t expect the weakness, he told us that things will be better next year (we’re supposed to believe the Fed’s predictive powers are improving) and he discussed the tools that remain available to the Fed and made me realize that the Fed will simply be shooting blanks. This speech should scare the hell out of you. It does me.

 

Leeds on Finance, the August 30 column

 

There's clearly a lot of concern that the tax laws for 2011 still aren't nailed down as a lot of employers, small business owners, etc work on budgets for 2011 and 2012. Really basic stuff like estate taxes, capital gains rates, qualified dividends, etc.

 

Some observers figure this is going to create (another) train wreck in the stock markets as people position their portfolios, and then jump every time somebody introduces a new wrinkle.

 

The bright side is this creates lots of work for estate and tax lawyers, brokers, insurance, etc.

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the question is: will the things that can be done and actually will be done in the near term have any noticeable effect? or is any real effort to address economic issues off the table until after the elections? and then? what to do? just hunker down, i suppose.

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The bright side is this creates lots of work for estate and tax lawyers, brokers, insurance, etc.

It's funny how, whatever shape the economy is in, that seems to be the one constant.

 

Is there a way to invest in these guys & reap a share of their profits? An ETLIT perhaps?

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it takes real economic prowess to read between the lines of Bernanke's speech

 

Ron, Except this doesn't explain away that the media by and large "spun" his speech into a favorable light.

 

It is admirable that a prominent college professor cited the spin being spread and himself penned an article so reality-based.

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it takes real economic prowess to read between the lines of Bernanke's speech

 

Ron, Except this doesn't explain away that the media by and large "spun" his speech into a favorable light.

 

It is admirable that a prominent college professor cited the spin being spread and himself penned an article so reality-based.

what? no one spun it like that.

 

and this guy ain't prominent. He's a lecturer - not a prof, and he only teaches in the executive MBA program at UT-Dallas. At least find someone who's views you support with tenure for chrissakes.

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it takes real economic prowess to read between the lines of Bernanke's speech

 

Ron, Except this doesn't explain away that the media by and large "spun" his speech into a favorable light.

 

It is admirable that a prominent college professor cited the spin being spread and himself penned an article so reality-based.

Is he really "prominent"? Although I don't read as much on the economy as I did when I was a trader, I've never heard of him.

 

ETA: Cross-posted with AB.

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Leeds's bio per UT-Austin McCombs School of Business: http://www.mccombs.utexas.edu/execed/faculty/bios/leeds.asp

 

Other than his teaching in the Executive MBA program, his background seems rather similar to a number of members here, from what I surmise. So I might listen to him as much as I might listen to members here. :P

 

My main takeaway from press coverage of Bernanke's speech was that it's up to the private sector to get cracking on job creation, that they should stop looking to the Fed to do it for them.

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