The link notes that Bernanke is speaking several times this week... And of course everytime Bernanke says anything these days the market seems to crash.
What to expect...?
More of the same... Bernanke simply has to tell the truth straightaway and stick to his story... The FED chair does not have the luxury of "flip-flopping" on the truth just the pacify the speculators on Wall Street...
Greenspan played that game for too long...and now Bernanke has to pay the price for the Bubble years of Greenspan.
Simply put...the US dollar is structurally weak...the trade deficit seems permanent...the US economy is deindustialized...Americans simply don't make the stuff they consume anymore.
AND NOTE WELL....HIGHER RATES WILL NOT CURE THE STRUCTURAL TRADE DEFICITS....
....OR THE OTHER DEFICITS CAUSED BY THE TAX CUTTING K-STREET KONGRESS!
So exactly how does Bernanke start talking the Wall Street way?
Well he doesn't because he can't ....the Jig is up as they say...and only the grim truth will do at this point.
My hunch is that at some point the markets will give back about 2000 points on the Dow... And even that won't "solve the problem" of the dollar...
I can't think of a single case where a key economic policy maker has been boxed in like this...except perhaps the German central bank in the 1920's when the "allies" cut off their funding and they were forced to hyper-inflate...
And we all know how that ended...
Postscript: J. Siegel misses the point in THIS interesting link...
