Overwhelmed by the Federal Reserve’s massive media presence recently?Jefferies economist David Zervos writes in a note out this morning that Chairman Ben Bernanke is on the warpath defending his policies, which means we can get used to policy accommodation for the long haul.
Ben’s full frontal attack via university classrooms, TV and newspapers represents an aggressive PR move from an institution that has rarely been so forthright. This manoeuvre can only mean one thing – there is a very itchy trigger finger on the Bazooka. There will be no 1930s style mistakes on Ben’s watch – that’s the real message. Whichever PR firm it was behind the scenes that designed this marketing campaign for the “Bernanke Put” has done a top notch job. I’m sold….go spoos!!
Zervos admits that Bernanke’s most recent comments do appear to imply some distaste from the Fed about more easing with balance sheet expansion. But he goes on to argue that, no matter how hard he tries, Bernanke will have a hard time weaning the Fed off inflationary monetary policy when the time comes.