Cream and sugar? …
If we had attended that law school graduation ceremony that Chairman Ben S. Bernanke was allowed to address last week …
And if we had been allowed to ask a question or two of the Chairman …
We would have asked him what he thought of Bill Gross’ warning about the trillions of taxpayer dollars that the U.S. government is giving to Wall Street interests. Mr. Gross heads Pimco, the giant bond fund, and his concern is that the U.S. may lose its AAA debt rating in a few years because of that misdirected attempt to “rescue the economy”. Is that a real possibility?, Mr. Gross wanted to know…
Mr. Bernanke would then have provide an answer … not to us, but to Mr. Gross.
[That’s why he told us to go scratch … ourselves up some “coffee or something”.]
Or we could have asked him about the wave of foreclosures among newly unemployed American homeowners who had acquired prime loans because of their decent credit standing. We would have reminded Mr. Bernanke that “60 percent of the mortgage faults this year,” according to Economy.com, “will be set off primarily by unemployment, up from 29 percent last year.” Mr. Bernanke surely knew that Mark Zandi, the chief economist at Moody’s Economy.com, has stated that “We’re right in the middle of this third wave, and it’s intensifying. That loss of jobs and loss of overtime hours and being forced from a full-time to a part-time job is resulting in defaults. They’re coast-to-coast.” Mr. Bernanke surely must have read that in The New York Times.
And he surely must have read what Morris A. Davis, a real estate expert at the University of Wisconsin said just recently. The New York Times reported this as well. “We’re about to have a big problem,” he was quoted as saying. “Foreclosures were bad last year? It’s going to get worse.”
Mr. Bernanke surely knew, even before it appeared in The Times, that the new administration’s February effort to aid troubled homeowners had fizzled. According to The Times, Alan Ruskin, chief strategist at RBS Greenwich Capital, evaluated the results of that effort and said, “I don’t think there’s any chance of government measures making more than a small dent.”
Mr. Bernanke mentions the “Great Depression”, but seems to know nothing at all about those eventful years. Like the majority of living Americans he’s seen a reference or two about that crisis, but if he’d spend just a little time looking into what ended that decade of heart-breaking poverty, he’d see that an immediate end to those sad years was brought about when the government mandated three emergency shipbuilding programs. As a result of those programs millions of depression era unemployed were hired almost overnight and hand-to-mouth existence came to an abrupt end.
[But the only program Mr. Bernanke offers to the rank and file is to “go get coffee or something”.]