[1] Via quoting from the Economist: “Mr Bernanke does not want to risk a de-anchoring of inflation expectations. He is willing to accept 10% or greater unemployment and the resulting economic and political fall-out in order to avoid that risk.”
[1] Via quoting from the Economist: “Mr Bernanke does not want to risk a de-anchoring of inflation expectations. He is willing to accept 10% or greater unemployment and the resulting economic and political fall-out in order to avoid that risk.”
Isn't that assumption always taken by default when considering nearly all market actions? That actors in the market are primarily motivated by selfish goals?
It also assumes that the home-borrowers, politicians, realtors and bankers who created the housing bubble were motivated by selfishness, as were the hedge fund managers and bankers who helped pop the bubble.
That needn't hinder one from constructing a conspiracy theory, though.
Greed is (not always) good.
Yes, and bankers are generally motivated by self-interest when undertaking market actions. However, we are not talking about a market action. The question is what motivates Ben Bernanke's decisions as the head of the Fed?
Is he a selfish kleptocrat trying to enrich himself and his buddies, or is he providing prudent guidance to the country and economy as a whole? Personally, I disapprove of his role and distrust the Fed's entirely, so I cannot provide a reasonable answer here.
He is still Ben Bernanke, right? Does the hat he wears change him? Assumption that people undertaking government position will forget about what their life was all about up to that point seems far fetched.