Ben Bernanke has just finished the first part of the testimony he is giving today before the Senate Banking Committee. He will shortly be joined by Hank Paulson and Christopher Cox to continue the session. Thoughts so far:
Gentle Ben is a staid and reassuring presence. He claims to be completely comfortable with the capital cushions of Fannie and Freddie and believes that banks, in general, are well-capitalized.
He believes supply and demand is behind the high price of oil (not speculation). Stockpiling has not occurred and the price is up across all currencies.
He is proposing new rules for credit cards to rein in some of the usurious and deceptive practices of that industry.
He stated that 2nd quarter growth was better than expected. He said he expects positive but not robust growth for the year.
Inflation, of course, is a concern. The Fed will begin factoring energy and food prices into their calculations of inflation.
Three other random notes:
Jim Bunning (R-Ken) is a old school anti-Fed nutjob. He railed against the Fed, blaming it for the current problems (partially true) and announced that he would fight with “all the power in his arsenal” to stop the accrual of additional power to the central bank.
Evan Bayh (D-Ind) is a haircut posing as a Senator. He’s a dope, unprepared, and fatuous. I’ll never forget the thinly veiled contempt Petraeus had for his hollowly combative questions in his most recent testimony re: Iraq.
Lastly, can you believe mortgage lenders didn’t have to verify income and assets before approving loans? The new regulations proposed by the Fed will make that simple due diligence a requirement. Is it me, or is that insane? Any lender or borrower who gave or received a loan under those circumstances should suffer the consequences.