Step on the gas, then the brakes. Repeat till Gentle Reader grows dizzy or the whole jerry-built vehicle falls apart.
Just as it did during during the Great Recession of 2007-09, when 9 million Americans lost their jobs and/or houses.
Then came the not-so-great recovery, which left the chairwoman of the
Naturally she did so in the most elevated terms, as in this great big helping of econospeak, a lingo in which she is fluent:
So now the Fed has devised volumes of arbitrary, changeable and immediately outdated regulations that go under the rubric of Stress Tests, which mainly test the ingenuity of this kind of stop-and-go driving to devise not reasons but rationales for it.
If what is desired is stability and clarity in the economic marketplace, why not just return to the refreshing simplicity, clarity and brevity of the Glass-Steagall Act of New Deal days?
Or would that be unthinkably simple, clear and brief?
But will the Fed and its ever-wavering chief ever learn? Even now she's suggesting that the Fed is open to little toe-tapping changes in speed and wobbly little shifts in direction that do more to unnerve investors than assure them. Or as Chairwoman Yellen put it in her ever more complicated but always defensive way: "Any adjustments to the regulatory framework should be modest and preserve the increase in resilience at large dealers and banks associated with the reforms put in place in recent years."
Unlike a Fed chairman named
Her speech at Jackson Hole gave no hint of any policy underneath all her equivocations. This may have been her farewell address, such as it was, as Fed chairwoman, for the much less conservative Trump administration seems to be champing at the bit for a dramatic change in economic policy, which has a way of leading to dramatic disaster. Something says Chairwoman Yellen is going to look good compared to any Trumped-up successor this high-energy, low-thought administration might choose as the next head of the
Chairwoman Yellen kept as mum as the Sphinx on the subject of just what economic policy she would favor down the unpredictable road ahead, but did hint that she would be open to fiddling with the Volcker Rule, which itself was a much-diluted form of the time-tested Glass-Steagall Act, which each generation of economists seems to think it can improve. Just how improve on perfection goes unexplained. But it's clear -- for this moment, anyway -- that the Fed might be ready to ease restrictions on smaller banks and let them trade in their own investments, the first step down a treacherous path that led right over a financial cliff back in the (all-too) Roaring Twenties.
"Her underlying message is clear: Don't forget the lessons of the past." So wrote one one economic guru,