Yellen: Not in Our Lifetimes
Please recall Janet Yellen’s June 2017 prediction: “Not Another Financial Crisis in Our Lifetimes“
“Would I say there will never, ever be another financial crisis?” Yellen said at a question-and-answer event in London. “You know probably that would be going too far but I do think we’re much safer and I hope that it will not be in our lifetimes and I don’t believe it will be,” she said.
Flash Forward December 11, 2018: Yellen Warns of Another Potential Financial crisis: ‘Gigantic Holes in the System’
I commented: “When you are in charge of the outhouse, you sing its plumbing praises. When you give speeches for money, you mention the stench.”
Permanently High Plateau
In 1929, just ahead of the great depression, Yale economist Irving Fisher was Jubilant. “Stock prices have reached what looks like a permanently high plateau,” said Fisher.
Bernanke in His Own Words
Also consider Bernanke: In His Own Words
- March 28, 2007: Chairman Bernanke said: “The impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.”
- May 17, 2007: Chairman Bernanke said: “We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”
- February 27, 2008: Chairman Bernanke said: “By later this year, housing will stop being such a big drag directly on GDP … I am satisfied with the general approach that we’re currently taking.”
- February 28, 2008: Chairman Bernanke said: “Among the largest banks, the capital ratios remain good and I don’t expect any serious problems … among the large, internationally active banks that make up a very substantial part of our banking system.”
- June 9, 2008: Chairman Bernanke said: “The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.”
- July 16, 2008: Chairman Bernanke said that Fannie Mae and Freddie Mac are “adequately capitalized” and “in no danger of failing.”
Trump’s Three Point Claim to Fame
- Natural Ability: Trump says “I Know So Much About the Coronavirus Because of Natural Ability”
- 15 Headed to Zero: On February 26, in a White House Briefing, Trump foolishly discussed the then 15 total cases in the US. “When you have 15 people, and the 15 within a couple of days is going to be down to close to zero, that’s a pretty good job we’ve done,” said Trump as noted in Coronavirus Week in Review: Top 10 Things That Happened.
- Trade Wars: Let’s not forget “Trade Wars are Good and Easy to Win.” For further discussion, please see Coronavirus Simulating a Full Blown Trump Trade War.
Mike “Mish” Shedlock
What about Greenspan!! He’s the one responsible for all this
Mish don’t forget Trump’s “I like the numbers where they are. I don’t want that ship docking and doubling the number.” That, together with the breathtaking 15 to zero comment demonstrate a staggering degree of stupidity and failure to comprehend simple biology.
Yellen , Bernanke etc they’re all smart but intelligent only gets you so much and they can’t admit they just don’t know
Say what you will about Alan Greenspan at least he left the Fed Funds rate at ONE number.
Ben (I’m so smart) Bernanke – Instead of just lowering the Fed Funds rate to 0, I’ll lower it to 0 – 0.25. Why? Because I’m so smart.
Two who continue the charade (or maybe they aren’t enough to change this back to one number): Janet Yellen and Jerome Powell.
If people think a range is needed: why not 0 – 0.24 or 0 – 0.26.
Maybe Grandma Yellen wasn’t planning on living this long. After all, it was nearly five years ago when she looked like she had a mini-stroke at the podium during one of her boring talks.
Think of the stock market Like a mug of draft beer… The Trump Hump was the huge frothy head that had nothing supporting it, and then the real market that drinks beer, blew it off all over the table.
There’s still plenty of foam left. Overpriced garbage.
Seeing asa how the Dow was around 75 pre Fed founding, I’d say so… Once it crosses 50 on the way down, we may perhaps have a problem… Until then, it’s another day.
Dow Jones sporting a “3” handle.
Yikes.
a “3” handle loss.
Wall Street playing a “three”. Three card monte…
It takes a natural crisis like this to show supply side economics make much better sense than running up huge debts to spur demand.
The guys trying to pass themselves off as “supply siders”, have been running up just as much debt buying back stock…
Without the limitations imposed by settlement in physical quantities of Gold, there are no limitations. No difference at all, aside from perhaps a slight delay, between even Volcker, and Mugabe.
Just saw this on CNN:
“”Every American adult should immediately receive $1,000 to help ensure families and workers can meet their short-term obligations and increase spending in the economy,” a release from Romney’s office states, adding, “Congress took similar action during the 2001 and 2008 recessions.”
Is Romney hallucinating, or did I miss getting my two grand?
I think he’s not kidding, but, what happened in 2001, and I think it was actually the 2000 tax year, I qualified for this since I had just started my own business and had zero income, and then, when I got the check, some people in the building I was in ended up fraudulently intercepting the check (I think they cashed it) and I never got the money. I do recall that incident. Not sure about 2008 however.
There was a 2% payroll tax deduction in 2009. That was probably worth about $1,000 on average.
Slight variations in the wording matter. You have her true comment as “I hope that it will not be in our lifetimes and I don’t believe it will be.” You picture shows “Not Another Financial Crisis in Our Lifetimes.” There’s a differences, however small. She had Hope and Believe. Your version made it sound way more concrete.
Just like people who say Trump said the virus was a hoax. He did not exactly say that. Regardless of liking or hating Trump or the Fed, these little inconsistencies are what the other side will latch onto.
It was the Reuters Headline in 2017
I used that at the time and reposted it.
But yes, I could have improved on that headline
Talking about Trump stupidity, let us not forget that even Bush was repeatedly called stupid and an idiot. Also some even referred to Obama’s style as ivy league stupidity and even resulted in the rise of the Bernie Sanders regressive left. So actually stupidity is a good qualification to last 2 terms
oil < $29 barrel
back in 2015 JPM and others moved heaven and earth to raise oil prices to get out from under energy related debt.
Good Luck.
The Free Market, is fighting tooth and nail to ensure the only goods which can be profitably produced, are the ones directly aiding fighting the virus.
And that the only people earning above subsistence, and even owning wealth above what’s necessary to avoid starvation, are doctors, nurses, other care personnel, cleaning personnel, equipment transporters, food and other base necessities producers, medical researchers and equipment producers, and soon perhaps crop dusting pilots.
Anyone or anything else is irrelevant and worthless. Yet of course the welfare idiots circling The Fed, are still doing their best to divert resources from the above, to utterly irrelevant dumb shit, like “saving” banks, airlines, “investments” and anything else except for what matters.
Well the policy of quarantine will not stop the spread of Covid-19 say some, only ‘flatten the peak’ and make it easier to treat people, so they all don’t get sick at once and overwhelm hospitals. So in a sense, the recession is ‘man made’. Compare the UK strategy of ‘herd immunity’ to the French, Italian, Greek, and Philippines strategy of basically locking down people in their homes. I’m not entirely sure the lockdown is necessary (again, lockdown will not make the disease go away; even China is reporting new cases everyday, and not clear to me how many either, whether to believe the official numbers or not). Not clear how the USA will go, whether they try the “UK” strategy or the continental/China strategy. China seems to have won with lockdown, but can you trust they’re telling the truth? I can’t.
If “the truth” from China was all that different from official numbers, Hong Kong would have been overran with sick people. Those guys wouldn’t shut up about it, either. No love lost between them and neither Carrie Lam nor her bosses.
China beat it back. It’s not rocket science. Just “severely” limit contact, disinfect everything and have a very efficient, and scalable, healthcare industrial system. Repeat until threat over. The hardest part for the rest of the world to duplicate, is the “industrial” part. Wuhan alone probably built more ICU units in a week, than San Francisco have built housing units, since the immediate aftermath of the great fire….
Biggest problem now, is China has little community immunity. So, need to quarantine everyone entering from places where the virus is not contained. You can bet they are very busy looking for a vaccine.
As crazy as it seems, ultimate immunity may have been the main concern of military strategists and their Neocon mouthpieces, who may have had Trump’s ear early on: Fear that China and Iran would take the lead in sick people, hence at some point have more widespread immunity, than the US. So that the US ended up “vulnerable” to a bio attack consisting of visiting Iranians and Chinese….
Now China looks to be the “weak man”, per that calculation…. No good deed goes unpunished, etc….
Let’s wait and see what the market fundamentals do with the price of oil and nat gas. We may all be surprised.
Let’s be honest. She didn’t believe it herself. Also for people like her, she wouldn’t call this a financial crisis. They would engage in word play and call things like this “an unexpected event”, etc, etc. Bullshitters will continue to BS.
yes, by 2018 she made it known publicly she thought Federal Reserve should be given latitude (by Congress) to buy other assets (read: equities) in next crisis.
The Federal reserve jawbone a lot. She was jawboning.
It doesn’t help that she looks like one of the Munchkins from Munchkin land. Or was that Mnuchin Land?
I would call this a health crisis, not a financial crisis.
It’s a financial crisis. The catalyst was a health crisis, but the issue itself is a financial crisis of our own making.
If your financial system cannot weather an event such as this, you don’t have a financial system you a have a confidence game designed and run by witch doctors.
Economics is nothing but human interaction. And no one person or group of persons can have enough data at any time to predict the totality and directions of human action. And the harder we try to push the issue, the more nature pushes back.
And this time, she may just shove us on our ass.
It’s actually a crisis across several dimensions. Read this: