Ben to Alan: "C'mon, let me be Fed Chairman"
Good Chairman, Bad Chairman... 
Alan Greenspan has twice optimistically declared "the worst of the housing adjustment" is over, first on October 7 and the second time yesterday. The timing of both remarks have come at the heels of a pessimistic inflation risk outlook by Ben Bernanke, his Fed Chair successor. Is it me, or don't these press announcements seem to allude to a drama akin to a father-son power squabble?
Oct.
4 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said the
U.S. housing market is in a "substantial correction'' that will lop about a
percentage point off economic growth in the second half and restrain the
expansion next year.
Oct.
6 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said
that last week's rise in weekly mortgage applications could signal that the
"worst may well be over'' for the U.S. housing industry, according to a
report of a speech Greenspan gave in Canada on Friday.
Nov. 28 (Associated Press) -- [...] Economists said Bernanke's comments dashed hopes— held by some in financial markets — that the Fed would soon cut interest rates. "His speech pours water on any notion of a rate cut around the corner,"
Nov. 28 (Associated Press) -- [...] Former Federal Reserve Chairman Alan Greenspan said on Tuesday that the worst of the housing adjustment was over, and that he was preparing to publish an analysis of the "serious dispute" over the true effect of mortgage wealth on consumer spending.
On November 28, Bernanke based his pessimistic inflation risk outlook largely on a spike in Q2 employee compensation by the Bureau of Economic Affairs (and the DJIA drops big). On
November 29, it turns out the BEA-revised employment compensation only rose at a
1.4% annual rate instead of the previously reported 7.4% (...big difference, no? and the DJIA is up again)
Nov.
29 (Marketwatch) -- "At a stroke, therefore, fears of surging unit
labor costs boosting inflation, cited by Mr. Bernanke yesterday, should be
greatly reduced," wrote Ian Shepherdson, chief U.S. economist for High
Frequency Economics. "You'd have thunk someone at the BEA could have called
him..."
"Ben, who's your daddy?" 
Technorati tags Fed Federal Reserve Greenspan Bernanke Alan Greenspan Ben Bernanke housing bubble housing market
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11/30/2006 2:20 PM
wrote:
Alan Greenspan has twice optimistically declared "the worst of the housing adjustment" is over, first on October 7 and the second time yesterday. The timing of both remarks have come at the heels of a pessimistic inflation risk outlook by Ben Bernanke, his Fed Chair successor. Is it me, or don't these press announcements seem to allude to a drama akin to a father-son power struggle?
After I finished this post, I noticed Jonathan at Matrix has a fine analysis of Bernanke's take on the economy, and he also noticed the timing of the Bernanke / Greenspan press remarks...
hey, great thinkers think...etc. etc.
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Just reinforcing my theory that the ecomomy predictions are about as accurate as the weather forcast.
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LOL "let me be Fed Chairman".
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The more I think about Bernanke and the markets being hoodwinked by a funny statistic for a whole day, the more I cringe about market transparency... someone (who made money) should have noted how off that wages figure was...
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