The Crash

The stock market crash of October 1929 showed, if anyone doubted it, that a concerted effort by the Fed can bring down stock prices. But the cost of this 'victory" was very high. The Fed began its tightening in 1928. An official recession was declared in August of 1929. The Fed ignored the facts and was focused on trying to "end speculation" on Wall Street. The market crash, rather than being the cause of the Depression was in fact largely the result of an economic slowdown and inappropriate monetary policies that preceded it. Of course, the stock market crash only worsened the economic situation, hurting consumer confidence and contributing to a still deeper downturn in 1930.

Greenspan's easy money in 2002 and 2003 and the reversal now entering its 3rd year of increasing rates "to end speculation in real estate" is another wrong Fed policy at the wrong time.

The markets will give the new Fed Chairman one time to raise rates....if he does more Barkly will be running for the sidelines. Barkly by nature will not take risk and fight a fight he can't win!