Bernanke’s Hobson’s Choice

By Paul Kedrosky · November 6, 2007 · ·

Fed Chairman Ben Bernanke faces a Hobson’s choice in picking between lower and higher a interest rates. On the one hand you have deflation, a screwed dollar, and an outside chance at preventing a recession (or worse); on the other hand you have a stronger dollar, but a screwed economy, and a continuing credit crisis.

Great post on the subject here.

Related posts:

  1. China Has a Worse Mortgage Problem Than the U.S.
  2. Probability of U.S. Recession in 2008
  3. “We Realize You Have a Choice of Bankrupt Airlines …”
  4. The Crisis in Crisis Management
  5. More Tim on 2.0: Lessons in Crisis Management

Comments

  1. W.C. Varones says:
    November 6, 2007 at 8:03 pm

    In prison, we had a term for what Bernanke is doing: the Slow Puncture.
    http://wcvarones.blogspot.com/2007/11/slow-puncture.html

  2. Nitin says:
    November 7, 2007 at 9:42 am

    It’s interesting to hear Jim Rogers (Bloomberg Interview) on this subject. He has gone on record calling Bernanke a nut for reducing rates.