Tell Me What You Think?

Like any author, I'm eager to hear what people think about what I've had to say and how you think the Fed and Bernanke in particular have handled the Great Panic. Post here -- but keep them polite and keep them short, please.

Comments

[Philip Dowling]

Dear Mr. Wessel,
How dare you! This morning (7/29/30) the Wall Street Journal Today radio broadcast featured the following statement attributed to you: "Bush left a ticking time bomb" in reference to the tax cuts set to expire on Dec. 31, 2010. MAYBE Mr. Wessel if you looked at the FACTS (and I know that this is awfully hard for you liberals to do) you will see that Bush and the Republicans tried, more than once, to get the tax cuts made permanent (again, if you need to verify this FACT simply go and check out the Congressional Record).
Stop blaming Bush for EVERYTHING and take some responsibility - Obama and the Democrats have had ample opportunity to tackle this issue!
Philip Dowling

[larrydc]

Good catch by prior commenter on "effective" vs. "ineffective." I didn't catch it myself but now I see the commenter is correct.

One other constructive criticism I'd offer:

On page 173, you quote an unnamed New York Fed staffer offering what, to me, is the most nonsensical sports metaphor imaginable: "If you think about basketball, you can have your toes on the line and you don't commit a foul unless you go over the line."

Huh? In basketball, a toe on the line is relevant to whether you are out of bounds or in bounds, not anything regarding a foul. And regardless, if your toes touch the line, you ARE out of bounds.

[Martin Killips]

David...

I have little interest in economics, and an aversion, bordering on phobic reaction to bankers and banking. However, I heard you interviewed by Deborah Cameron this morning on ABC radio (Australia) and found your comments wonderfully intelligent, precise and seemingly, to my ignorant mind, wholely accurate. I shall buy your book - or perhaps we can swap books?! I write children's poetry and have five collections in circulation (www.TheBigBamboo.com.au).

Thank you once more for brightening up my journey this morning.

[Robert L. Levin]

Dear Mr. Wessel:

I have thoroughly enjoyed "In Fed We Trust." I very sincerely suggest that an error appears to exist on the 9th line from the bottom of page 126. The word "ineffective" I believe should be "effective."

Having retired four years ago as a community banker with an continuing interest in our economy, I found myself glued to the excitement generated by your fine work in creating "In Fed We Trust!"

Sincerely yours,

Robert L. Levin

[Martin S]

David Wessell and the WSJ are hypocrites and something idiotic comes out everytime Wessell touches his keyboard. Here's an example from "The Unemployable Male"

Wessell writes:
"One way to resist these market forces is to reduce the supply of workers who aren't in demand and increase the supply of workers who are"

Yet Wessell are the number one cheerleaders for both legal and illegal immigration, not even stopping their siren song when we have 20 million unemployed in our country at present.

[Brad]

Hi David, The artical about unemployed men is oh so true, cuz I'm one of those men. The fact the education is basicly for women cuz I tried to get back to school. talk about jumping thru hops. I'm not a racist. But for 'white' men to get any education, you have to have money back ground which I dont have. Or great scores when in school. which I didnt have. So I'm out of luck :( this process needs looked into.

[Gregory J. McKenzie]

David congratulations on your book. It takes a brave man to take a stand! Do you think that The
Federal Reserve is right in keeping interest rates so low? Good luck at the Sydney Writers's Festival.
Greg McKenzie
Sydney, Australia

[Tom]

Hello David
I very much enjoyed your book. You refer to Bernanke's Dashboard and the "Financial Stress Indicator" which is defined as the percentage point gap between the rate banks charge one another for 3 month loans and the expected Fed rate. Where can we access this so that we can monitor this for ourselves?
Cheers,
-Tom

[coach handbag]

I absolutely love this blog!!! I have recently became a twilight fan and this has helped me a lot. keep up your work, You’re awesome!

[Gilbert T. Bremicker, Jr. Cherokee, Iowa]

David -
There were two factors that contributed to the sub prime mortgage problems that I wish you had discussed in your book. The first is real estate dealers that sold clients more house than they could afford. The second is appraisers that did not do a professional job and some times asked the realitor what price they needed to make the sale. The licensing boards of realtors and appraisers in California, Arizona, Texas and Florida need to investigate and cancel some licenses.

To get a copy of your book, our City librarian dove 120 miles round trip to get a loaner edition fron from the Sioux City Library.

[Ron Israel, M.D.]

In Fed We Trust really was helpful. Having tried to follow the events of the past several years many things were put in context for me. As a 'layman' in finance I found the book clear. There surely is a huge difference in reading a book by a journalist who knows how to write rather than one by an economist. For my upcoming book club I would like to update some of the information
and learn where the government stands now with their (our) loans, guarantees, and investments. Any suggestions as to where on the web I might find some summaries. I think that the Fed/Treasury saved us from a meltdown but probably at the cost of prolonged high unemplyment and low growth. Thanks for all your work in doing this book

[Howard Phelps]

Something you said at a book signing some time back has stuck with me. In answer to the question,"How could so many smart economists fail to foresee the oncoming recession"? You said it was a "failure of imagination", Let's take that a bit further; there are lots of calls for increasing employment these days but not so much about increasing demand which I believe must be the percursor to increased employment. Just looking some very gross data, let's say for the moment that the annual dollar value of gross imports is $500 billion. what would be the inpact both long and short term of cutting into imports with U.S. production? If, say we could increase the demand for US goods and services in the US 20%as a percentage of imports or roughly $100 billion annually(without debating "how" for the minute, but it is not more Buy American restrictions, etc), could we develop a curve showing over time the impact in terms of potential added jobs?

The "how" is a consumer based promotional/advertising program not associated with government along with a data base on the scale of a Google but none of which has been "imagined".

[Darko Oracic]

Dear David,

There is a huge blind spot in your book. It's the role of high interest rates in the housing bust. Bernanke continued with the monetary tightening started by Greenspan, bringing the federal funds rate to 5.25% in mid-2006. In the same year, real residential investment growth turned negative (-7.3%. Just a coincidence? I don't think so. All the recessions in the past were caused by monetary tightenings. The last one is no exception.

[Bill Grimson]

You mention the role of laypersons on one committee in your book. Do you think laypersons at various levels in banks, FED, and other bodies might have avoided the panic. (Laypersons who are educated, but not necessarily in finance or economics, but have absolute integrity).

[Darko Oracic]

Dear David,
A key point is missing in your book: the Bernanke's fascinating speech before the Economic Club of New York on March 20, 2006, entitled "Reflections on the Yield Curve and Monetary Policy". He said: "... historically, the slope of the yield curve has tended to decline significantly in advance of recessions. What is the relevance of this scenario for today?" None, he said, this time it's different: "I would not interpret the currently very flat yield as indicating a significant economic slowdown to come...". Maybe you should put this in the chapter "The Age of Delusion".

[Frosty]

Mr. Wessel--
Your CSpan program with Alice Rivlin was excellent. Please, please gather your cohorts and press for better regulation against "gambling" with insurance and bank deposits and other investor money. This situation eventually will bite us big-time if we do not get a handle on it. U.S. MUST be the leader in this. We are very concerned as investors and grandparents. There is NOTHING wrong with true conservative investing with compounding working its magic. This "thin air" economy is spooky. Your program was the MOST HONEST outing and we were grateful to you both for telling the truth. Now, we need action. If we can help, please let us know. We know that Bernie Sanders has some legislation, but what else is there we can do to help? We both have worked in banks before we retired. We understood how it worked in the "old days" you were talking about! Thank you! Frosty in Phoenix

[Kris Hammargren]

Great book, David. In fact, Stephen Malpezzi in the University of Wisconsin's real estate program put it on his Reading for Life list. He posted his review of it this week at http://wisconsinviewpoint.blogspot.com/

Keep up the good work!

[Ross Corace]

David, I received your book as a gift over Christmas and could'nt put it down. I t was very interesting and informative-as far as it goes. You failed to mention that Paulson's reason for bailing out AIG could have been to protect his buddies at Goldman. I know he was supposed to have sold his stock when he accepted the Treasurer's position (he probably has some squirreled away), but why not at least mention this as a possibility. Also,I think you should have had a Chapter on unintended consequences of the Fed's actions. This country will not insulate itself from more panics until it embraces hard work, individual liberty, savings, production, investment, sound money, de-regulation, exports, budget surpluses, capitalism, limited government, and respect for the Constitution. As a resul of Bernanke's interference, I feat we will continue to have more panics with less time in-between.

[Carol A. Wilson]

Dear David,

After reading reviews and hearing you talk about your book, I am waiting for my copy to arrive (along with a copy for a friend). Congratulations! Do you mind if I say I knew you - oh so many years ago.

Carol A. Wilson, Architect
Falmouth, Maine

[Darko Oracic]

Ben Bernanke has been chronically wrong. First, he supported overly low interest rates to prevent deflation. As that created inflationary pressures, esp. in housing, he increased interest rates too far, ignoring recession warnings coming from their term structure. When the recession started, he slashed interest rates to zero. That, of course, will recover the economy first and then bring high inflation. Then he will fight inflation with overly high interest rates and start a new recession, etc., etc. He will continue to err because he thinks he is so smart. And, of course, he will continue to deny any past wrongdoing on his behalf.

[Susan Durham]

David,
Thank you for explaining the Panic so that an ordinary retired person can understand it. It was especially helpful to finally read about the "unbanks".

Susan

[Marie Gauron]

"Why didn't the Fed force AIG counterparties to take less than 100 cents...."

What about various articles I have read that say AIG is a big front organization for CIA operations? Maybe that's why they honored all the obligations. Why can't we ever know the truth in these matters?

[Laurence Clark Day]

Again, I object to the"snide" word remark about Krugman referring to "zombie" banks. They were zombies. I know. I worked for decades with brokerage firms/ investment banks, one of which was run by the Walker branch of the Bush clan.

Paul Krugman is the best that Princeton has to offer and the return is the finest educational experience of any university bar none. A teacher par excellence. Ask Shirley Tilghman, Princeton's President, who affirmed that in a personal letter to me.

Krugman should be running the Fed or Sec't of the Treasury, not some young pup beholden to self-serving unpatriotic Wall Street and its ill-gotten millions who have brought our country down and laugh about it.

[Laurence Clark Day]

Paul Krugman "generally unpopular with students and colleagues...". Not to my knowledge. Is that a swipe at him from the editorial page perspective of the Wall Street Jrnl? What is your research for such a comment. You were in his classes at Princeton I gather and you have first-hand knowledge. I was at Princeton.

Hope your book is more informative than that uncalled for remark. Should I read on or get a refund.

[joan callender]

Unlike the unselfish Wall Streeters you represent I am one of those who thinks I have a right to resources. I do even if I don't have the value of a Bernanke, Bloomberg, Rubin, Blankfein, etc. God, I'm tired of people like you being lionized and fawned over because you have the courage to tell people like me that we better stop taking more than we give. Go tell it to Goldman Sachs.