Real-Time Decisions vs Parsing Statements

I want to highlight a post from Jeff Miller’s “A Dash of Insight” that provides a little depth and a different perspective of Dr. Bernanke and his decision making process.  Here’s a snippet:

With so much written about Fed Chairman Ben Bernanke, you might doubt that there is anything fresh to say.  Wrong!

Not only is there a new way to think about Bernanke, it will probably help your investment results.

One of the most costly mistakes that traders or investors could make over the last two years is the “Bernanke Blunder.”  This mistake includes everyone who has left money on the table — or even worse, lost through shorting the market — because of their opinions about the Fed Chair.

There are many reasons why people might choose to dislike Bernanke:

  1. He was appointed by a Republican, so Democrats might object.
  2. He was reappointed by a Democrat, so Republicans can object.
  3. He is an academic, so everyone who thinks he is smarter, wiser, or has more street sense than the Chairman of the Princeton Economics deepartment can show his superiority.  You know about inflation, and he obviously does not!
  4. He has Keynesian roots, from his research and books.  Those with a different economic philosophy can pound away with “hair of the dog” homilies — no data required.
  5. He is the head of a central bank.  Anyone who disagrees with the concept of central banking can choose Bernanke as the personification of this evil.

This is a must read article.  Your opinion of the Fed’s actions will not change the fact that they are happening.  You cannot let a philosophical worldview or your economic religious affiliations stop you from making rational choices with your trading account.  While I may not like everything that he has done, I feel that Bernanke has made excellent decisions with the information available considering the situation the world was facing.  It’s easy to criticize his decisions after the fact without offering any alternatives in real-time other than to let the markets and the economy burn to the ground.

Click over to read the article in its entirety:

A New Viewpoint on Bernanke (A Dash Of Insight)


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