1115.org

Obama gives Bernanke vote of confidence - Reuters (7/26/07):

“I think that Chairman Bernanke was handed a pretty tough hand and I think some of the decisions he’s made have been the right ones.”

Bernanke’s academic work influenced some of the decisions that caused the problems in the first place. As the housing and credit bubbles were inflating, he was on the Board of Governors of the Federal Reserve and then Chairman of the Council of Economic Advisers shuffling the cards. As Fed Chairman, he has ruined the Fed’s balance sheet, did nothing to protect the dollar, and has almost certainly exceeded the Fed’s mandate by allowing banks and later investment banks to borrow funds using near-worthless securities as collateral. There is also little doubt that he will refuse to raise interest rates before the election despite rising prices on nearly everything. Heckuva job, Benny!

There is no reason whatsoever for Obama to be defending Bernanke. If he’s too much of a political coward to advance his own (or his advisors’) more realistic ideas, he should say nothing at all. Former Fed Chair Paul Volcker, the last one to face a set of problems like we are facing now, has been an Obama backer since the beginning. I know he knows better than this, and he’s sure as hell made that point to Obama.

This is the same bullshit that allows incompetent people to slither back to positions of power when they should be relegated to impotent think tank jobs.