If Bernanke Told the Truth...

Ben Bernanke seems to be sailing to another term as the nation’s chief central banker. Obama gave him a big push. When it looked like that might not be enough, Tim Geithner tried blackmail.

Failure to return Bernanke to the Fed could cause market instability, he told the Senators.

These poor dumbos…all of them. Larry Summers, Ben Bernanke, Tim Geither…Barack Obama…and all the House and the Senate (the only exception we know of is our old friend Ron Paul)…

…None of them has a clue. They warned Congress in September ’09 that the world would come to an end unless Wall Street was bailed out. They got their way. Wall Street was bailed out; and the world didn’t come to an end. So, they must have been right about it.

None of them knows what is going on. And none of them has any interest in finding out. When it comes to the feds, ignorance pays.

Who wants a Fed chief who admits the truth?

“I’m sorry,” Bernanke should tell a televised joint session of Congress. “Our economy is de-leveraging. There is nothing we can do except get out of the way.

“If we bail out failed enterprises, we will have more failed enterprises.

“If we pay people not to work, we will have more people not working.

“If we provide more credit, we will have even more debt.

“If the government uses more resources, the private sector will have fewer resources.

“Forget it. There’s no way out. So, let’s stop all this gimcrackery. Let’s back off and let the markets do their work: let failed companies go broke…let homeowners who can’t pay their mortgages lose their houses…let speculators lose money…let the chips fall where they may, so that the next generation of entrepreneurs can pick them up and make something with them. Let it be.”

Mr. Bernanke would be lucky to make it out of the Capitol alive.

The Daily Reckoning