In the mid-2000s, Alan Greenspan was the hero of the financial world. With his blunt philosophy of inflation, Greenspan was credited for turning the tech-bust into a real estate and financial boom.
Following the 2008/2009 meltdown, Greenspan morphed from hero to scapegoat (or for Thanksgiving aficionados; turkey to feather duster).
Another Turkey to Feather Duster Roundtrip?
Bernanke carried on the torch of fearless Keynesian Fed Presidents and made it on the cover of Time magazine within his first term. Much ink has been spilled about the effects and side effects of quantitative easing in general and QE2 in particular .
Actions speak louder than words, and the initial reaction by stocks and commodities has been net-positive (at least when going back to the initial announcement), which is exactly what the financial alchemists in Washington wanted to see; but, what about the economy or the unemployed? Obviously, that's only a secondary concern.
According to Bernanke (quoted in the Washington Post), inflating stock prices is the golden grail of today's monetary policy: 'Higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending. Increased spending will lead to higher incomes and profits that, in a virtuous circle, will further support economic expansion.'
Dow Jones Industrial Average
(DJI: ^DJI )| Index Value: | 11,052.49 |
|---|---|
| Trade Time: | 4:02PM EST |
| Change: |  39.51 (0.36%) |
| Prev Close: | 11,092.00 |
|---|---|
| Open: | 11,083.75 |
| Day's Range: | 10,929.28 -11,083.82 |
| 52wk Range: | 9,596.04 -11,505.80 |
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