James Bullard
Bullard’s official position is President of the Federal Reserve Bank of St. Louis. However, his main contribution to the financial crisis is being in the Federal Reserve’s legion of useful idiots. As a useful idiot, Bullard is rarely involved in the establishment of policy like Fed heavyweights Ben Bernanke (#3), Alan Blinder (#5), Alan Greenspan (#29), or Frederick Mishkin (#36). Instead, Bullard’s task is typically more pedestrian. He is routinely featured on talk shows to explain what the Fed is doing now and what it might be doing in the future. In this regard, Bullard is assisted mightily by the equally large legion of Fed shills and media lackeys – see Steve Liesman (#33) and Martin Wolf (#50). Bullard is so sufficiently unfamiliar with the real corridors of power that he occasionally goes off-script and commits the mortal Washington D.C. sin of telling the truth. In September 2013 Bullard stated, “The bubbles we had in the past were gigantic and obvious.” Less than 2-months later, Bullard stated the “tech bubble was blindingly obvious. And the housing bubble also (was) blindingly obvious.”
While these statements are hardly earthshattering and completely consistent with easily verifiable statistics of the respective tech stock and housing bubble eras, the statements were in complete contradiction to Alan Greenspan’s policy on financial bubbles – a policy that Ben Bernanke subsequently endorsed. Here is Alan Greenspan in August 2002 at the Federal Reserve’s annual boondoggle in Jackson Hole, Wyoming;
“We at the Federal Reserve considered a number of issues related to asset bubbles - that is, surges in prices of assets to unsustainable levels. As events evolved, we recognized that, despite our suspicions, it was very difficult to definitively identify a bubble until after the fact - that is, when it’s bursting confirmed its existence.”
Greenspan and Bernanke are using the same excuse for not taking action against the tech stock bubble; bubbles can’t be seen until they burst. However, Bullard – a president of a Federal Reserve Bank no less, is saying the tech stock and housing bubbles were “gigantic and obvious” and “blindingly obvious.” The contradiction between Greenspan/Bernanke and Bullard regarding bubbles is itself blindingly obvious and proves the Federal Reserve is either staffed by;
a) dolts, who are unable to observe the formation of two of the largest bubbles in history
b) liars, who will say anything to avoid accepting responsibility for the inevitable errors that will occur whenever power as awesome as the Fed holds is wielded by a mere handful of people
Whether the Fed is comprised of dolts or liars, the contradiction exposed by Bullard and the Fed’s obvious bubble befuddlement “isn’t a great advertisement for monetary dictatorship.”
Additional Information:
For more examples of the idiocy that runs rampant at both the Federal Reserve and the highest levels of the economic profession see Ben Bernanke (#3), Alan Blinder (#5), Alan Greenspan (#29), and Frederick Mishkin (#36). Bernanke, Blinder and Mishkin all have PhDs in economics from MIT. Greenspan’s PhD in economics is from NYU.