Questioning assumptions

"An ancestor of mine maintained, that if you eliminate the impossible, whatever remains, however improbable, must be the truth."

-Captain Spock

Bernanke's refusal to engage in the Vulcan logic encapsulated in the above quote is tantamount to establishing a priesthood at the Fed. They simply cannot return from their chosen path. This is most unfortunate. This is the modern equivalent of drawing more blood from the patient with viral/infection symptoms, but unfortunately lacking a Hypocratic focus on doing no harm.

Top-down measures, including TARP and the currenct policy of ZIRP and QE, based on arbitrary access (and perhaps influence) by money center banks, has had very little effect for over 5 quarters. At this point, the economy may improve, but this will be a pity, for the Fed, the Executive, and the Legislative branches will have learned very little.