BizJournals Portfolio
Home >   Business Views, Opinions and Blogs >   Business Blogs >   Market Movers >  

Unpredictable Bernanke

Market Movers

by Yves Smith and Felix Salmon
Main
Barack Obama Gets it Right on Cap-and-Trade   Blogonomics: How Big Media Will Sell Ads on Blogs

Recent Blog Posts

Links

Oct 09 2007 12:00am EDT

Unpredictable Bernanke

One of the reasons that the markets loved the Greenspan Fed was that it was generally very predictable: for all that Greenspan was an expert at mumbling incomprehensibly, the markets never seemed to be in much doubt what he would do at any given meeting. Bernanke, by contrast, is full of surprises: first the discount-rate cut, then the 50bp Fed funds rate cut, and now no one has a clue whether he'll cut again in October or not.

Predictability is not a bad thing in a Fed board: if you know what you're going to do, there's really no harm in signalling that to the markets. Maybe as Bernanke gets more settled in, his actions will be more predictable. But for the time being, it seems that the markets will get a little bit nervous in the run-up to any Fed meeting. Which might make Bernanke look good, ironically enough: the markets might well rise whatever he does, just because he will have lifted the cloud of uncertainty.

(HT: Mark Thoma)

blog comments powered by Disqus
Real Business, Real Results
Out of the 'Family'

Did anyone at Microsoft ever watch the (gasp!) offensively funny show Family Guy?

Cruz Missile Lands

Ex-Morgan Stanley exec Zoe Cruz is now heading her own hedge fund. Are Wall Street's leaders done?

Scandal Chic

Martha, Bernie and Skilling know that what you wear for court can go a long way in public perception.

spotlight on

Health Care

Bad to the Bone No More

Companies such as General Mills say they're stepping up efforts to change employees' bad behavior and promote healthier lifestyles. Read More