Let me first say that 60 minutes is hands down the best show on television. It is the one show that I absolutely must watch every week. If I don’t watch it for some reason, I have to find it online and watch the show on the laptop. This week, 60 Minutes reporter, Scott Pelley, had an unprecedented interview with the sitting chairman of the Federal Reserve, Ben Bernanke (a.k.a. Big Ben).
So why should we thank President George Bush? Don’t get me wrong. I am not generally a fan of President Bush. However, I do think we should give credit, where credit is due. We should all be grateful that President Bush chose Ben Bernanke to the Chairman of the Board of Governors of the Federal Reserve. Call it foresight, call it wisdom, call it luck, call it anything you want, Mr. Bernanke was and is the perfect person for the job. I doubt there is any other person in the world who is better qualified to be the head of the U.S. Federal Reserve during the most difficult economic environment, since the Great Depression.
The key takeaways from this interview are; first, we have THE expert on the Great Depression overseeing the efforts to pull us out of this economic downturn. When Mr. Bernanke speaks about our economic crisis, he leaves the impression that he knows what he is talking about and that is because he does. Confidence in this environment is very important and he is very confident about his role and his mission to stabilize the economy. Another key point that Bernanke touched on was that our economy will probably pull out of this downturn sometime in the next year. That tells me that the financial markets may have bottomed or are close to bottoming (famous last words). The equity markets are a discounting mechanism. The markets always look forward. What we see in the market today reflects what the market expects in the economy six to twelve months in the future. So thank you Ben for calling the bottom of the market! Mr. Bernanke also said, even though it upsets most tax payers, it is necessary to save the financial institutions of this country. He is absolutely right. Like or not, the financial institutions are the engine of our economy. If the engine isn’t working properly, the car isn’t going to go anywhere. Finally, the most important comment that Chairman Bernanke made was that we (i.e. our representatives in Washington) need to have the “political will” to make the appropriate monetary and policy adjustments to get through this crisis. What that means to me is that if politicians in Washington D.C. continue their partisan politics (as usual), we may not be able to right the ship. We need our representatives in Washington NOT act in their own political best interests or legislate along party lines. Our representatives in Washington need to step up and simply do the right thing to stimulate the U.S. economy enough to pull out of this deep recession.
Take a look at the Bernanke interview:
Confidence…Confidence…Confidence!
We need more confidence from our representatives running the show in Washington. Now take a look at the SNL skit from two Saturday’s ago (below). This is how the public views the Treasury Secretary, Tim Geithner. To be fair to Mr. Geithner, he did just start on the job. Who knows maybe he will grow into the position and become a great Treasury Secretary. In the meantime, Mr. Geithner leaves a lot to be desired. The Treasury’s Secretary’s initial announcement concerning the stimulus/recovery package was a complete disaster. Its a shame the Obama administration didn’t have the foresight to nominate a Treasury Secretary that has sales skills and a few gray hairs. Having a Treasury Secretary that would have hit the ground running would have helped to inject confidence and optimism in the financial markets.
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