Bernanke's Speech Tomorrow

Miscellaneous Current Events
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Any predictions?

I assume he’s going to say (yes, this is pure speculation):

  1. We’re currently in the process of a modest, growing, and yet uneven recovery where corporate profits are near all-time highs while, simultaneously, growth in the labor market continues to stagnate.
  2. We expect some degree of mild commodity inflation in the short-run, partially fueled by elevated demand from emerging economies such as China.
  3. General inflation doesn’t seem likely in the long run until there is significant growth in the labor market.
  4. Interest rate hikes are inevitable and will occur at some (unspecified) point in the future, but not before the labor market shows signs of adequate growth.
  5. Government deficits need to be controlled but government shouldn’t go too far in the midst of a fragile recovery.
  6. There needs to be some degree of global coordination in order to avoid uneven international adjustments which may potentially yield instability.
  7. He’ll probably try to simultaneously ease both inflationary and deflationary expectations, and wont rule out the possibility of QE3.

Basically, I don’t think he’s going to say anything of substance but the fact that his speech tomorrow could potentially cause the price of stocks and commodities to either rise or fall by 40% is extremely interesting. I would be horrified as an investor.

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Good thread. Your predictions seem to make sense, and you’re definitely right about him making the attempt to ease inflationary and deflationary expectations. It’ll be all PC. I might watch it, I think it’ll be broadcast on the Fed website.

His degree of nervousness will probably show us more than anything. I expect extreme voice quivering and forehead-vein throbbing.

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Indeed. I’m looking forward to it.

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I don’t think it will happen at this conference, but I’m waiting for the “Bernanke put”- that the Fed will stand by and print for the Treasury, triple A or otherwise.