Déjà vu all over again.
Another spring, another housing-recovery chorus. The grass turning green … another turning of economic corner. The days are longer, oil prices are higher, a new fatal shortage nigh. With the vernal equinox, Fed easing must be overdone, bond yields are rising, the easing propelling inflation trading and the stock market.
Spring, and the sweet scent of horse manure.
Birds are chirping, leaves and blossoms bursting open, but the economy is still largely where it has been since bouncing off bottom in the spring of 2009. Home sales are not rising, new or used. Prices may have flattened, but are not going up. The distressed "pig in the python" still threatens to depart the pig in alarming mass, volume and velocity.
Oil is fooling around $100 a barrel, but it’s impossible to square a dangerous shortage with substitutable natural gas one-seventh its price at the decade peak (natural gas, which was $15.38 per 1 million British thermal units in December 2005, was $2.29 this week).
U.S. oil imports have fallen from 60 percent of consumption to 50 percent and falling. Global coal is undoing its entire run from 2007-2011, $165 per ton to $65 per ton.
The jump in bond yields began to reverse this week, the instant that Federal Reserve Chairman Ben Bernanke said, "It’s far too early to declare victory."
The biggest deal, of course, is jobs. While waiting for next week’s Good Friday release of March payrolls, consider more from Bernanke this week: "Importantly, despite the recent improvement, the job market remains far from normal; for example, the number of people working and total hours worked are still significantly below pre-crisis peaks, while the unemployment rate remains well above what most economists judge to be its long-run sustainable level."
Alternate to the drivel that passes for economic news on CNBC, Fox and Bloomberg (and opinion pieces in the Wall Street Journal and New York Times), please try to read the few pages of Bernanke’s full speech.
It’s in English, and a model for how to suspend your biases and hunches and mull evidence while the hopes of the world depend on your judgment.
All seems normal: pain evident among some friends and many strangers, but cars and trucks move as always, lights come on at night, shoppers and goods are in stores, but it’s all a mask covering a U.S. government that hasn’t been this absent from the scene since the 1920s — maybe even the 1850s.
Congress is too afraid of constituents to speak truth. This poor man, the president, soon may endure Supreme Court overthrow of his sole domestic achievement (no matter at whose hand: it would have collapsed of its own overcomplication and expense).
Want a hero? Someone to hold up to your kids as an example? Somebody above and beyond in public service? Selfless? Wishing only to be inconspicuous, but pushed forward by events? Leading as few ever have before? Leading decisively through chaos, but including his opponents, and even encouraging their public disagreement?
Have you given up, that there are such people in public life? Excoriated every day by blimps not half his intellect, not a tenth his understanding, yet treating all with dignified firmness? And in private — his actions always in private — as decisive as any Napoleon, and more aware of the consequences of error than any captain of arms?
Ben S. Bernanke. Annual salary: $191,300. Maybe he’ll write a rich-making book at the end, like his failed predecessor; maybe he’ll have a quiet passage to retirement, like Paul Volcker.
Bernanke blew it as Alan Greenspan’s understudy from 2002-05, and in his first year as chairman in 2006. He missed the credit bubble, which he knows more deeply and painfully than anyone else alive.
He was slow to grasp the extent of emergency in July 2007, but he got it in the following January and ever since he has carried this nation on his back.
He has been the singular effective executive in U.S. government, holding the night at bay: two Treasury secretaries and two presidents in over their heads.
Bernanke knows better than anyone that his utterly experimental measures to stop the greatest bank run of all time risk an inflation disaster.
And he knows that no matter how hard and inventively he tries, he may be unable to prevent a rerun of the 1930s, especially with no help from the rest of government.
One man, a quiet academic, embracing disciplined doubt, clearheaded and willing to act in the face of a warm, glowing, spring-hiding emergency. Do tell the kids someday.
