Ben Bernanke is the Smartest Guy in the Room

The Return of the Salad Days

Treasury-check_350_optLet’s talk about the return of the salad days of the economy. I have heard scores of people say it is just around the corner. I have heard other say 2011 is the big year. Yet the realists say it is some time off. I am going out on a limb here. I say 2013 is the year we will actually start to feel the effects of the economy on our wallets and bank accounts. The market as a whole is overpriced. Interest on deposits are underpriced. With the recent flood of Fed Money into the bond market there soon should begin a measurable shift in the behavior of the cost and return on real money. But all this as it will affect us will take some time.

The Unusual and the Unexpected

The international pundits say we are self-serving. Yet they remain big investors in the United States of America. As long as we are healthy their investments should remain healthy. So quiet down China, Russia and Brazil. We are in the midst of reforming the structural elements of our economy. We are rebuilding the foundation for sustained economic growth. In a time where all the rules have changed we need to do the unusual and the unexpected. Pouring 600 billion dollars into the bond market is a smart move. Ben Bernanke is the smartest guy in the room. He knows what he is doing. He is the most forward thinking Chairman we have ever seen. Let him pull the levers and push the buttons that need attention. Make the moves that long term have the best effect on getting the economy back on tempo.

My Bet is 2013

The best thing for us all to do now is to be patient. Be watchful. Be mindful and be inventive. By all of us playing by the same rules we will see gradual but sustained growth. After all that is what we all want and all need. The return to the salad days will take some time but it will come. My bet is 2013.

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George Lovato, Jr. is President and Principal of BH Capital Ltd., Merchant Banker, Consultant, Author and Lecturer. Happily married for over 30 years to his childhood sweetheart Gale, they live nestled in the shadows of the Sandia Mountains in Albuquerque with their six hounds.

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