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

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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

  1. 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.”
  2. 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.”
  3. 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."
  4. 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.”
  5. 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.”
  6. 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

  1. Natural Ability: Trump says "I Know So Much About the Coronavirus Because of Natural Ability"
  2. 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.
  3. 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

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