“Top U. S. officials threw their weight behind the dollar Thursday, with the Treasury chief stressing the importance of a strong dollar and the Federal Reserve chief addressing concern about the greenback’s future as a reserve currency.” (Wall Street Journal: http://online.wsj.com/article/SB125440283756156107.html.)
What was the name of the Treasury Secretary…O’Neill? Or, was it Snow? Or, was it Paulson?
Oh, well.
And the Federal Reserve chief…that was Greenspan, wasn’t it?
And the value of the dollar dropped more than 40% against other major currencies!
Oh, that was the Bush (43) Administration.
When it comes to international confidence in a country’s currency, the officials of that country’s government must not just “Talk the Talk”, they must “Walk the Walk”!
Don’t watch the lips…keep your eyes on the hips!
Talk, talk, talk, talk…
Federal deficits growing out into the future in the neighborhood of $10 trillion or more!
Monetary policy where the banking system averaged excess reserves of $855 billion for the two weeks ending September 23, 2009! And, in a banking system where required reserves averaged only $60 billion for the same time period.
After nine years of promises from different Treasury Secretaries and from two Chairmen of the Board of Governors of the Federal Reserve System why is there no credibility in these statements?
The value of the U. S. Dollar is down against the Euro by about 11% since January 20, 2009 and the value of the U. S. Dollar against major currencies is down about 10% since January 20, 2009.
The report card given this administration by international financial markets is not good.
My guess is that the value of the U. S. Dollar will continue to fall over the next year or two and will continue to fall until participants in international financial markets see some action on the part of the United States Government and not just empty talk from its Treasury Secretary and the Chairman of its central bank.
Showing posts with label Federal Reserve chairman. Show all posts
Showing posts with label Federal Reserve chairman. Show all posts
Friday, October 2, 2009
Monday, June 23, 2008
Credibility?
This is what it all boils down to…
Saturday, the Wall Street Journal put it on the line. In an editorial titled “Bernanke’s Market Week”, the Journal states that “The most precious commodity a Fed Chairman has is credibility.” The article goes on to say, “the Fed has a growing credibility problem” related to the weakness in the value of the dollar. You can find the editorial at http://online.wsj.com/article_print/SB121400288407493271.html.
Unfortunately, this is only one piece of the picture. This whole administration has a credibility problem. And, it starts right at the top. (You might note Thomas Friedman's column for Sunday June 22: "Mr. Bush: Lead or Leave." http://www.nytimes.com/2008/06/22/opinion/22friedman.html?em&ex=1214366400&en=fd288df78dd325e6&ei=5070)
The culture of an administration…whether it be a business…a family…a non-profit organization…or the national government…is determined by the leader. Everything that a leader says…or does…should reflect the culture that he or she wants to see permeate his or her administration. It is reflected in the people that the leader chooses to join the administration. It is reflected in what happens to people once they join the administration. That is, everything that is done by the leader “hangs together”.
The consequences of the culture created are ultimately there for all to see.
The leader cannot control events…the leader can only control how his or her administration anticipates or respond to events. And, the actions of an administration reflect the thing that it can directly influence…the culture established by its leader. And this culture engulfs all who are a member…the talented as well as the less talented.
This administration only has a few more months left. Lost credibility cannot be regained in that period of time. The world has begun to focus on the credibility of the people now seeking to become the leader of the United States. What kind of culture will these people create once they achieve the goal they are chasing?
Within this kind of environment, it is hard to imagine that the financial markets will settle down. There will be rallies here and there. There will be sell-offs here and there. Given that there is little or no credibility to be found these days in Washington, D. C. who can place a bet on what anyone says.
In the waning days of this administration…
this is what it all boils down to!
Saturday, the Wall Street Journal put it on the line. In an editorial titled “Bernanke’s Market Week”, the Journal states that “The most precious commodity a Fed Chairman has is credibility.” The article goes on to say, “the Fed has a growing credibility problem” related to the weakness in the value of the dollar. You can find the editorial at http://online.wsj.com/article_print/SB121400288407493271.html.
Unfortunately, this is only one piece of the picture. This whole administration has a credibility problem. And, it starts right at the top. (You might note Thomas Friedman's column for Sunday June 22: "Mr. Bush: Lead or Leave." http://www.nytimes.com/2008/06/22/opinion/22friedman.html?em&ex=1214366400&en=fd288df78dd325e6&ei=5070)
The culture of an administration…whether it be a business…a family…a non-profit organization…or the national government…is determined by the leader. Everything that a leader says…or does…should reflect the culture that he or she wants to see permeate his or her administration. It is reflected in the people that the leader chooses to join the administration. It is reflected in what happens to people once they join the administration. That is, everything that is done by the leader “hangs together”.
The consequences of the culture created are ultimately there for all to see.
The leader cannot control events…the leader can only control how his or her administration anticipates or respond to events. And, the actions of an administration reflect the thing that it can directly influence…the culture established by its leader. And this culture engulfs all who are a member…the talented as well as the less talented.
This administration only has a few more months left. Lost credibility cannot be regained in that period of time. The world has begun to focus on the credibility of the people now seeking to become the leader of the United States. What kind of culture will these people create once they achieve the goal they are chasing?
Within this kind of environment, it is hard to imagine that the financial markets will settle down. There will be rallies here and there. There will be sell-offs here and there. Given that there is little or no credibility to be found these days in Washington, D. C. who can place a bet on what anyone says.
In the waning days of this administration…
this is what it all boils down to!
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