From The Bloomberg 50 Summit: (Anyone Seen Ritholtz?)
September 15, 2011 2:02 pm
I just notice that Barry blogged that he is heading down to the event. Where are you Barry? I am over toward the left side…..
It has been a rather interesting morning so far. Not much in the way of bullish sentiment from any of the speakers today. All of the notes will be posted over the next couple of days, but here is a taste of some of the opinions and commentary from this morning:
Bernank’s Balancing Act 9am-940am
Bruce Kasdan discussed that Bernanke may not have much that he can do and that getting the committee to move will be a process. The next meeting with surely give us TWIST and then SHOUT, which is a more vocal communication. The FED is on the move it has a lot of problems in the economy it is dealing with. Expect more, not less in the future
Don Brownstein – What is risk of Fed Policy?
The economy is clear. What should be done… Fed needs to be accommodative, but perhaps temporize too much, The big problem is that the transmission mechanism, is dysfunctional. That is typical after this kind of banking crisis. Better to get something that gets under the car and fixed the transmission The most evident is the need to get the banks lending. Region banks have not been as easy going as theu would like to be. Maybe the foot shouldiers should be listening to the Generals more closely. Somehow we need to get the banks to lend
Glen Hubbard: Fiscal or?
Bernanke policies are limited. It is a fiscal need at this point. Invstment has been slowed down due to regulations, no housing boom and the markets. there is a clear need to have a fiscal policy that allows for the benefit to
Bob Doll – Is Fed trying to boost stocks?
Fed is trying to install confidence. We need to get out of this confidence bear that we are in That is whhy in Jackson Hole he tried to extend the confidence by putting in a long term interest rate assumption so that some of the questions are cleared up.
General discussion about whether it is fiscal or monetary policy, generally all see that that there is a combined effort and that interest rates have low enough at this point. We are in a time that there is a slippery slope if we hope that Congress comes in and does what they have to. Communications tools need to be used and can me quite powerful as Congress and the Administration is impotent. All appear to agree that we are in need of stimulus and help.
Perhaps the biggest issue is the lack of leadership and the inability for them to lead. The most concerning is that there is also a crisis of confidence that started and is continuing. It is the combination of the lack of leadership as well as the concern that the FED is not doing all it can (?really). The things that are being down are not helping. There is a general agreement that the plans and other stimulus measures have not done anything and are not going to do much in its current forms. If nothing is done on the fiscal side, there will be a drag of about 2% of GDP.
Demand is weak as there is no confidence but also because there is not enough stimulus on a short term basis. There are things that can be done, but are not. The overall political situation at this time is at best, un-encouraging.