No One Has His Back

Smashed donkey pinata Photograph by Jeffrey Coolidge/Getty Images

They now understand much better than they did before that this institution has something to do with the jobs that are created for constituents. And it also has something to do with inflation, which constituents don’t like. And it also has something to do with interest rates, and high interest rates are not something that constituents like very much.

–Allan H. Meltzer, Interview with Allan H. Meltzer, author of A History of the Federal Reserve, Douglas Clement, The Region, Federal Reserve Bank of Minneapolis, September 2003

We have a rigged economy through central economic planning by central banking and the whole system is failing. It was doomed to fail, and we have to wake up.

–Representative Ron Paul, (R-TX), in an interview with Trish Regan and Adam Johnson, Street Smarts, Bloomberg Television, September 13, 2012

Allan & Alan.

There is much that Meltzer and Blinder can disagree on. They share, however, a vast common ground.

Part of their shared territory is the genuine understanding of unshared sacrifice the chairman of the Federal Reserve System has endured in these recent historic days.

The wise, of Carnegie Mellon University and Princeton University, no doubt, would agree that 98.3% of the Quantitative Easing Unlimited punditry is shall we say… less informed.

I was quite taken aback by the certitude, on and off camera and microphone, of Bernanke as piñata.

Memo: Macroeconomics is squishy. There are numerous moving parts (not the least, 3 to about 7 flavors of Taylor’s Rule). Macroeconomics needs microeconomic foundations, which requires a semblance of income and substitution statics edging towards dynamics. This semblance is near universally devoid of all but educated graduate and undergraduate economists. (Chicago graduates get hugs because it is beaten into them.)

Forget the economic blather. Forget the indignant righteousness of the right and left. Forget the laughably bad analysis of events that are original and desperate.

This is Anxious America. Focus upon the dithering others.

I’m in support, strong support of this Chairman. He is alone in Washington as all other institutions shirk their responsibilities.

No one has his back. Discuss.

    Before it's here, it's on the Bloomberg Terminal. LEARN MORE