Dr. Prescribes Steroid And Heroin For My Son!
In 2003, my son was not performing well at all – socially, academically, or athletically – so I took him to the doctor.
The doctor had spent years doing research but had never actually practiced medicine – so I was a bit concerned when he prescribed steroids and heroin to my son.
My son nonetheless responded well to the combination, becoming much bigger, more fearless, and more compliant.
He did, however, quickly become addicted to the drugs and started to act kind of crazy by 2007 – taking crazy risks and beating up the neighbors.
I asked the doctor if this was an issue, and he said I had nothing to worry about.
But, then only a year a later, my son went completely crazy and smashed up his bedroom, over-extended himself, filed for bankruptcy and went into a coma – all over the course of a month!
Needless to say, I was very concerned at this point, so I dragged my son back to the doctor to point out all of the damage his prescriptions had caused.
And, to my dismay, the doctor insisted he had done nothing wrong and instead prescribed heroin and cocaine to my son.
This of course brought my son back to life, but he has grown and done very little ever since.
Knowing that the doctor ruined my son’s life, I have been trying to get the authorities to take his medical license for several years now.
BUT – I just found out the doctor won the Nobel prize for medicine because the Nobel committee loves to prescribe heroin, steroids, and cocaine too…
Former Fed Chair Bernanke Wins Nobel Prize In Economics
OK… if anyone is still reading this blog, they probably figured out that my above story is allegorical: the “good” doctor is Ben Bernanke; my son is the U.S. economy; and the heroin is the excessively low rates that our economy is addicted to.
Ben Bernanke was the Fed Chair from 2006 – 2014, and he was on the Fed’s Board of Governors prior to that. So, he not only oversaw the entire 2008 Great Financial Crisis, he was instrumental in causing it, per most macro pundits.
And that is why I was shocked to see him win the Nobel Prize in economics this week.
Mr. Bernanke was a huge proponent of low rates in the early 2000s, arguing that we were in a state of “great moderation” in which business cycles would always be mild. In 2007, he famously stated the subprime crisis was contained and not a problem – about a year before the subprime crisis melted down the entire financial world.
In other words – man, was he wrong!
After the crisis hit, Mr. Bernanke launched massive regulations, Quantitative Easing (QE), excessively low rates, and massive bailouts for his friends… I mean large banks.
Mr. Bernanke and his friends all insist that they saved the world.
But, many macro observers like Jeff Snider, George Gammon, Jim Rickards, Steve Forbes, Erik Townsend, Lyn Alden, etc. (I could go on and on) think the regulations, excessively low rates, and bailouts fostered far lower than normal growth, a belief that Fed will rescue risk takers and stock market gamblers, and massive income inequality (because Fed Policy just drove up asset prices for the rich).
These people think the Fed should have instead let some of the big banks go belly up (and prevent some of their managers, who made bad bets, from walking away with 9-figure paydays as a result of bailouts), let the market determine interest rates, avoid QE and/or meddle much less in the markets overall.
It may seem like the Fed fostered stability over the last 14 years, but it also fostered low growth (that hurts the poor the most), asset bubbles, malinvestment in unprofitable businesses that will crash at some point, an enormous Fed balance sheet that will have to be unwound at some point, and numerous other messes that will all come home to roost sooner or later – and it will likely be very painful.
Our entire economy has become addicted to the monetary heroin of low rates, QE and Fed bailouts – and detoxing is proving to be very painful. And many observers fervently believe that Mr. Bernanke is to blame for much of that pain.
But instead of blaming Mr. Bernanke, many other authorities, who believed in the same prescriptions that Mr. Bernanke pushed, insist on offering Mr. Bernanke a Nobel Prize 😊
Perhaps it was to cover up their own mistakes?
Here is a WSJ editorial making a similar case: Bernanke Wins a Nobel In Theory.
And HERE is a Jeff Snider Podcast where he really goes after the absurdity of this award.
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