On Wed, Apr 22, 2009 at 11:25 AM, Jim Devine <[email protected]> wrote: > The problem is summarized by something I read in the ECONOMIST a long > time ago: if you're going to predict a recession, you can predict > _that_ it's going to happen but you can't predict _when_.
This excuse works for academic economists but not for the Fed for two reasons. One, they have access to a great amount of timely data including surveys, forecasts as well as market trends. Two, they are in the unique position where they CAN predict exactly when a boom ends simply because their actions have the character of a self-fulfilling prophesy. For instance, Alan Greenspan recognized that credit spreads were getting too narrow and indicated high levels of risk-taking and said as much, but did nothing about it. So "We didn't know there was a problem" is not an excuse that Greenspan and Bernanke can honestly use. They *knew* there was a problem. They simply underestimated what it'd take to clean it up when the bubble bursts. -raghu. -- Plankton lobbyist: "NUKE THE WHALES!" _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
