Bernanke May Know Too Much

For those of us who work on Wall Street or analyze financial markets, it has been a depressing month. It's not only that stock prices have been decimated, with the Dow Jones Industrial Average falling to 10,700 and the technology-dominated NASDAQ Composite index plumbing its lowest depths since October. It is the alarming way in which investors have been selling into rallies.

Every day, it is a titanic struggle of bulls and bears. Trading may start on an upbeat note, but pessimism then takes over and by the end of the day the market loses 1 or 2 percent. The Tuesday session was typical: The Dow was up 50 points early, went in and out of positive territory four times and ended 86 points in the red.

Along with other emerging markets, the Moscow bourse is already deep in a technical bear stage, defined as a 20 percent decline in market indices. Russia's dollar-based RTS index is down 500 points peak to trough, or over 25 percent. The index lost nearly 10 percent on Tuesday. Bears are nibbling on some major markets, as well. The Nikkei Average in Tokyo, for instance, is down 18 percent since early April.

The sell-off has not yet reached bottom. But if a global bear market does arrive, untried U.S. Federal Reserve Chairman Ben Bernanke may prove to be the wrong man for the job. His problem is that he is trying to use academic science to manage a system created by his predecessor, Alan Greenspan, one of history's most successful creative impostors.

http://www.themoscowtimes.com/stories/2006/06/15/005.html

has done is raise rates. Its not stopping the hidden inflation, its not supporting the market, and its not good for anyone but.....and that is the key to what appears to be a puzzle.

...Greenie's moldy bag of elephant dung.

Sir Allan indeed...