Helicopter Ben


Who can forget that famous speech by Ben Bernanke, beloved economics professor at Princeton and then member of the Board of Directors of the Federal Reserve System, back in 2002?  In it he quoted another famous economist, Milton Friedman, who suggested, presumably tongue in cheek, that one way of avoiding price deflation would be by “dropping money out of a helicopter.”  Today the media applies this term more frequently to Bernanke, now Chairman of the Federal Reserve, rather than Friedman, endowing him with the sobriquet “Helicopter Ben.”

I doubt many would take umbrage with that appellation.  After all, under Bernanke’s watch the Fed has embarked on a series of somewhat revolutionary monetary stimuli designed to bolster the economy.  We have seen Quantitative Easing, the Son of Quantitative Easing, QE III, and QE4ever.  But, while currently continuing to inflate the U.S. money supply by roughly $85 billion each month, the desired end result remains elusive.  Hoping to ignite a self-perpetuating recovery by inflating certain asset classes has not completely panned out.  The latter is in fine fettle; the former remains elusive.

So what’s up with that?  I reckon it depends on where you place the helicopter.  If it was hovering over Main Street, the results might have manifested as hoped.  Instead, it seems to be located above Wall Street and the wealthy grow more so.  Will most Americans continue accepting that it is the banks (and bankers) who seem to be catching most of those bucks by the bucketful?       (by J R)