Explainer: Bernanke’s Secret Plan To Raise Rates Too Late (3 min):
Why is Ben Bernanke being so slow to start talking about raising rates, much less start raising them? Because he has a secret plan that he can’t talk about.
What’s Ben’s secret plan?
Intentionally keep rates too low for too long, thus encouraging uncomfortably high inflation.
Why would Ben want that when he keeps talking about the importance of managing inflation?
- Faster economic growth, which leads to more jobs, fewer angry constituents, and a Congress that’s happier with Ben Bernanke
- Faster erosion of the real value of our debts. Consumers and the government are drowning under a massive debt load. One way to make paying off this debt easier is to make the dollars it is denominated in worth less. Bernanke will try to hasten this process as much as possible, taking it right to the point where our creditor China is mad as hell–but not quite to the point where China actually stops lending to us.
Produced By: Kamelia Angelova & William Wei
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