For most experts, failure is a learning experience that leads to a search for new methods. Thatâ€™s not true for central bankers. When their policies fail, they try more of the same in the vain hope that quantity will make up for the lack of quality in their ideas.
The post The Fedâ€™s Legacy: Asset Bubbles and Lost Confidence was originally published at The Wall Street Examiner.
Submitted by Charles Hugh-Smith of OfTwoMinds blog, Central bankers must accept the complete and utter failure of their policies if we are to move forward. Central bankers are now in the denial and anger stages of Kubler-Ross's fame...
Central Bankers will never openly admit that they or their policies have failed. Moreover, they do not rush into sudden tightening (more on this in a moment). But one can begin to notice subtle changes in their language and actions ...
When central bankers dedicate their existence to re-inflating asset bubbles, it shouldn't at all be a surprise to investors that they eventually achieve success.
The Fed has a tiger by the tail with its program. It is creating a giant bubble in capital asset prices, especially in our stock markets. To let the tiger go is to be eaten.