Federal Reserve Chairman Ben Bernanke told a panel examining the U.S. financial crisis that he had no options to prevent Lehman Brothers’ failure in September 2008 even though he knew its downfall would be “catastrophic” to the financial system and economy.
The Lehman failure set off severe market turmoil, spurring debate about whether the government should have done more at the time to halt the investment bank’s collapse. Speaking to the Financial Crisis Inquiry Commission on Thursday, Mr. Bernanke said legal and practical considerations prevented taking action, even though “I never at any time wavered in my view that we should do absolutely everything possible to prevent the failure of Lehman.”
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Right now, we are in the middle of deflation. The Global Depression we are experiencing has squeezed both aggregate demand levels and aggregate asset prices as never before. Since the credit crunch of September 2008, the U.S. and world economies have been slowly circling the deflationary drain.
To counter this, the U.S. government has been running [...]
Is the global economy out of the woods? Two years after near-meltdown, with the U.S. looking sluggish, equity markets groggy and Europeans fighting a debt crisis, experts gathered in Italy offered a generally gloomy outlook — especially for the United States and much of the industrialized world.
The doomsayers were led by New York University economist [...]
If you’re like me and reluctant to join the stock market frenzy with open arms, then consider buying reverse index funds that bet against Treasury bonds.
This strategy offers a high value alternative to joining a 50%-plus stock market rally since March as long-term interest rates rise on most days when the stock market climbs.
As stocks [...]
Question: Looking into the future of the American economy, I see tons of debt, the yoke of increasing social spending, pork-fed bureaucratic waste, the exporting of jobs and the importing of poverty. While this may paint a negative picture, I feel it’s reality. We all want to be patriotic, but aren’t there more fiscally responsible [...]
Should we blame newspapers for talking down the U.S. economy, maybe even to the cusp of a double dip?
That’s the contention of equity bulls. They argue that, despite reasonably solid fundamentals, the media’s unrelenting gloominess about the state of the world is proving a drag on sentiment. Declining consumer and business confidence will then cause [...]
U.S. consumer confidence unexpectedly rose to 53.5 in August, the Conference Board said, as Americans became somewhat more positive about the short-term outlook for the economy.
A Bloomberg survey had expected the index to rise to 51.0 in August from 50.4 in July. It hit a record low of 25.3 in April 2009.
In August, two of [...]
Bigger, as the Federal Reserve may soon discover, is not always better.
The prospect of a renewed effort by the U.S. central bank to drive down already super-low borrowing costs raises the issue of whether such measures can help stimulate a recovery that is faltering due to a lack of consumer demand.
The sorry state of the [...]
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