27 June 2008

The Fed and the economy explained

Global markets trader and blogger Macro man has written a clear and clever summary of the current US economic situation, through the lens of The Princess Bride.
Macro Man: Vizzini takes charge of the Fed

There was a remarkable development at the start of the Federal Open Market Committee's deliberations last night which somehow managed to stay out of the financial press. Fortunately, Macro Man has a mole in Washington who's filled him in on what went down.

Shockingly, Ben Bernanke and the rest of the committee have abdicated responsibility for determining monetary policy this month. Fortunately, the policy vacuum has been filled by an incomparable intellect: Vizzini, the Sicilian of Princess Bride fame. Macro Man's mole has provided him with a verbatim transcript of yesterday's policy deliberation after a black-cloaked stranger walked into the Federal Reserve conference room:

Vizzini: So it is down to you, and it is down to me. If you wish the economy dead, by all means, keep moving forward.

Dread Pirate Inflation: Let me explain--

V: There is nothing to explain. You are trying to kill the consumer that I have rightfully supported.

DPI: Perhaps an arrangement can be reached?

V: There will be no arrangement, and you're killing the consumer.

DPI: Well if there can be no arrangement, then we are at an impasse.

Read the rest here - Macro Man: Vizzini takes charge of the Fed.

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