In response to a Tweet by Capital Account host Lauren Lyster regarding my post Ben Bernanke: Inflationist Jackass, Devoid of Common Sense, and Clueless About Trade, Debt, History, and Gold, Jo Weisenthal at Business Insider proposed a debate.
We had that debate yesterday and here is the video.
Link if video does not play: Mish vs. Weisenthal: Bernanke's Class Lecture on Money Leads to After-School Blog Brawl
In the course of a quick 15 minute debate broken into a series of 30 second sound bites, it is sometimes difficult to get everything said that needed to be said. One point I did not get a chance to mention again, but I did bring up in my Blog rebuttal to Weisenthal, is that central bank planning of money supply and interest rates is in and of itself ridiculous. Repeat bubbles and bailouts prove it.
Soviet Style Planned Economies Do Not Work
It makes as much sense for a group of guys in a room to attempt to set a price and amount of money as it did for inept Soviet-style central planners to run an economy, setting the price and amount of steel production and other goods - precisely none.
Certainly the Greenspan Fed ignored (cheerleaded is a better word), the housing bubble every step of the way. Bernanke defended the housing bubble and failed to see its consequences.
Stability and Flexibility
The most amazing, and galling thing, is Bernanke has the nerve to preach about "price stability" in the wake of that collapse.
Jo wants the flexibility for the Fed to step in and cleanup messes. I don't want the flexibility of fractional reserve lending and fiat currencies because that is what created these messes in the first place.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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