This entire era since post-2008 was never about anything more than propagating a wholly unsustainable consumption binge, all while the real economy was sold out the back door. Bernanke swears that he was saving us from Depression, but that would assume that people using their homes as ATM machines in the period leading up to 2008, was the least bit sustainable. The obvious reality is that Bernanke created a new asset bubble just to replace the one created by Greenspan.
This entire era was a case study in Shock Doctrine. Following 2008, the comfort-seekers at large were curled up in the fetal position and hence very vulnerable to economic opportunism. That is how the Fed and Treasury passed a bailout for Wall Street without any accountability. Since that time, corporate outsourcing went into manic overdrive as the frat boys and billionaires took full advantage of the situation to boost profit margins to unprecedented levels. All while the real economy, jobs, business creation, organic growth was destroyed. The entire policy of Quantitative Easing was merely to create a monetary-inflated smoke screen to allow the estate sale to be completed. That's text book Shock Doctrine in a nutshell.
Like Greenspan before him, Bernanke is not a total fool. He realizes that there is no exit strategy for all of this liquidity now propping up insolvent financial assets. He knows implicitly that the Minsky Moment is inevitable and that the house of cards will collapse. Greenspan knew the same thing about the Housing Boom. He knew that lowering interest rates to 1% post-9/11 created a massive borrowing spree. He also knew that illegal aliens making $2/hour were buying $750k McMansions. He knew about "NINJA" loans - No Income, No Job, No Assets - No problem. He was well aware that Subprime was a latent time bomb due to Wall Street CDO alchemy. He knew that Adjustable Rate Mortgage (ARM) interest rate resets would eventually annihilate borrowers.
The Case-Schiller Home Price Index w/Greenspan retirement
Note that home prices still have not recovered despite 5 years of Extend and Pretend and $3+ trillion of monetary expansion. More proof that the economic recovery is a widely accepted delusion.
Feb. 1999
The Committee to roll back Glass-Steagall and inflate the subprime derivates-based housing bubble:
The Idiocracy Gets Conned Again
Bernanke cleaned up Greenspan's bubble, but he isn't going to clean up his own.
Dow 20 Year w/Bernanke's term in blue
In Bernanke We Trust
2009 Man of the Year aka. "The Committee to Clean-up After Greenspan"
And then to create history's largest ever monetary bubble without any comparison whatsoever...
And then to create history's largest ever monetary bubble without any comparison whatsoever...
