National Ledger - Ben Bernanke Rate Cuts Called "Nuts"

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By Jon Shanks Nov 5, 2007

Is Ben Bernanke really nuts? That's what one investor believes. Last week the Fed lowered its target interest rate to 4.5%. The Dow Jones Industrial Average duly rallied, only to be handed a 362-point drubbing the next day. Does he really have any idea what he is doing?

The Fed again cut its benchmark interest rate by a quarter point and policymakers have now lowered their target rate for overnight loans between banks by 0.75 percentage points in six weeks, the most aggressive easing since the economy was emerging from its last recession in 2001. Is this the right thing to do?

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"Bernanke loves printing money,'' veteran investor Jim Rogers said in an interview with Bloomberg in New York. "This man is a nut. The dollar is collapsing, commodities are going through the roof, which means inflation's going through the roof. These people are leading us to terrible problems down the line.''

The UK Times says Ben Bernanke must step over media tripwires and opines, "The Fed eased last week only because Mr. Bernanke had allowed market expectations to get so one-sided that failing to deliver a rate cut might have triggered a financial meltdown – and after the credit crisis of early August, this was a risk the Fed Chairman presumably was not prepared to run. Mr. Bernanke cannot afford to let himself be trapped in this way again.

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