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Powell on Cycles


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“There’s really no reason to think that this cycle can’t continue for quite some time, effectively indefinitely,” Powell said Wednesday at an event in Washington hosted by The Atlantic magazine and the Aspen Institute.

 

Well, this sounds to me like a Chuck Prince line if ever I heard one (and so makes me think about selling things).

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“There’s really no reason to think that this cycle can’t continue for quite some time, effectively indefinitely,” Powell said Wednesday at an event in Washington hosted by The Atlantic magazine and the Aspen Institute.

 

Well, this sounds to me like a Chuck Prince line if ever I heard one (and so makes me think about selling things).

 

Thanks for posting this.  I am not sure what his context in saying that was.

However, Powell's line only completely ignores the history of booms and busts and human beings very irrational nature.

 

In 1825 Benjamin Disraeli proclaimed an end to boom and bust given superior commercial knowledge.

 

Sometimes when things seem the best they are the worst.

 

 

 

 

 

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Good point on questioning the source & context.  I saw it on Bloomberg, but this gives a bit more context.

 

https://www.theatlantic.com/politics/archive/2018/10/federal-reserve-chair-jerome-powell-ignoring-trump/572110/

 

This makes it sound better i.e. he was reacting to a pithy question.

 

I'll never forget Gordon Brown, then Chancellor in the UK, effectively saying that he had brought about the end of Boom and Bust in the 00s.  Some hubris there...

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Don’t worry about what Powell says at all, he is a cheerleader for the Fed / his employer. It’s his job. Watch what he does.

Maybe the quote needs context but speaking of cheerleading and potential errors in interpretation, interesting to note what Mr. Timothy Geithner, who plays on the same team, said under similar circumstances. In his memoirs, referring to the "mood" of the times around 2003 or 2004, he said: "There was growing confidence that {what "we" had done} had made devastating crises a thing of the past.”...

 

His memoirs are an interesting read and, at times, he appears to be unusually candid about his own responsibilities. And I happen to think that he did quite a good job, once in the crisis, to navigate through the tough times. However, I find that, even retrospectively, he could not even consider that things could have turned out differently which is kind of scary. A comment made in a review of his memoirs summarizes this well: "There are two big worrying things here. The first is that Geithner didn’t see the crisis coming at all, and indeed was something of a cheerleader for all of the dangerous activities that the banks were getting up to. The second, which is just as bad, is that with hindsight, Geithner sees this speech as being prescient and heroic — that it’s something to be proud of, rather than sheepishly ashamed of." (my bold)

 

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