Chuck Ponzi May 11th, 2006

The clowns over at Columbia Business School have a great little parody group going over there that has captured the Zetigeist of current economics and its odds against politics.

You can see the video here. (be prepared, it is both large, and requires a special codec, but watching it is very funny)

The best thing for this country right now is an aggressive anti-inflation policy. We missed it for the last 2 years, but we should not delay the pain any longer. Each day, your dollar buys less and less. Remember, inflation is not the increase in supply of money, creating a process where excess money is chasing limited resources (housing bubble anyone). The money supply is already out of control, and needs to be reigned in. It would go a long way to fight inflation if the interest rates were to jump by 50 basis points in June.

Either way, Bernanke’s tough words and action have shown us that he is no clown. He has far more testicular fortitude than many thought he would. Both his utterances to the media and actions since taking over have show that he is serious, and is much more readable than his predecessor.

For many of the financial media; beware of reading too much into Bernanke’s statements, you are no longer working with G-span and need to just listen to his words until you understand plain english… he will flight inflation as much and wherever he needs to.

However, the real problem is the out of control money supply. Hiking rates will have a far smaller impact than controlling the issuance of liar loans, negative amortization, and zero-down loans. These are the inherent vice in the banking and financial system. Even a weakening of the economy causes these tissues of mortgages to fold like a mortgage bank in OC. I believe we are about to see a much stronger monetary policy from a man who has cajones to make it happen.

• Uncategorized