Enough with the Bernanke bashing

Within the confines of a totally dysfunctional government, the Fed chief has done what he can.

By Jim Cramer Sep 4, 2012 8:59AM

TheStreet.comEnough Bernanke bashing already. I am sick of it, just sick of it. Let me ask you a simple question: What have the other central bankers done right that makes him seem like such a dope to so many of you?


Sure, the Fed chief was slow to recognize the housing bubble that was created by his predecessor's attempts to stoke the economy after the burst dot-com bubble that his predecessor created by never raising margin rates. Sure, he should have cut to the bone in 2008, but commodity inflation was raging.


Since then, Bernanke has done his best to get housing restarted -- working; keep retail afloat -- working; and generate some construction of late. This is all within the confines of a totally dysfunctional government that includes the worst partisanship since the Civil War. Does everyone blame him for that, too?


Have you ever listened to Congress when it badgers this man? It's insane. Its members know so little that it is a wonder he even stays on the job.


In the interim, what have his colleagues done? Let's see, last year, former European Central Bank President John Claude Trichet raised rates twice. That was brilliant! That nailed inflation in its tracks, didn't it? That has to be the dumbest policy move of the decade. The ECB still has not come to grips with its crisis the way much-derided Bernanke has. We would really be calling for those guys' heads. As it is, we had to listen to a totally wrong Fed president from St. Louis, who advocated tightening here at the same time Trichet wanted it.


Is that what the Bernanke bashers want? A little solid tightening?


How about the Indians? They've done a bang-up job of slowing growth while stoking inflation. Bravo. Much better than Bernanke, no?


And let's deal with the Chinese, those so-called brilliant businessmen. Here you have a command economy, no GOP-Democrat fratricide there. They were supposed to have everything figured out. They have nothing figured out other than they know to dump goods into Europe and Europe ain't taking them anymore. That's the real cause of their problems. Is their central bank filled with genius? I prefer Lenin's New Economic Policy. Now, there was a central banker-cum-dictator who knew how to get the job done with maximum slaughter.


So I say enough of this already. Bernanke has done what he can. This is all on Congress and President Barack Obama. And if you want the world's economy jump-started, I think the German Supreme Court is more important than Bernanke.


Lay off him. That's an order.


Random musings: I'm thinking Facebook (FB) is really losing out to Twitter in part because of the latter's mobile apps. I like using Twitter more on mobile than on the desktop, in part because Facebook is trying to trick you into clicking on ads, which makes it so younger people will leave in droves. I liked Facebook as long as the migration from desktop to mobile was slow, and I was counting on that. But it turned out to be lightening-like, and that's why the numbers are slowing so badly. Happened on a dime, right around when Peter Thiel put in his sell order. Remember, as I wrote at the end of "Confessions of a Street Addict," it is better to be lucky than to be good. It was dumb luck that caused the sell program to be entered just when the desktop faded and mobile took off, wasn't it? Wasn't it?


Jim Cramer 


Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust has no positions in the stocks mentioned.



More from TheStreet.com

Sep 4, 2012 12:20PM
in addition to oldchum's comments, mr cramer failed to mention that the federal reserve supervises almost all large banks. gentle ben and his predessor the criminal, dr g had mountains of info indicating that banks had become reckless and did nothing. the current low interest rates amount to a subsidy to those reckless institutions. they have to pay depositers nothing, while they receive interest from the federal reserve. as mentioned a number of times by commenters below, this also creates enormous hardship for savers. mr o did not create the problem, but by appointing timmy g and tacitly supporting bush appointee gentle ben, he contributes to the destruction of savers. both republicans and democrats continue to reward failure and punish those who tried to follow the rules. i have no problem with incentives, but i do have a problem with rewarding failure and bailing out the miscreants.
Sep 4, 2012 12:19PM
The totally dysfunctional government that Wall street owns! Nuff said!
Sep 4, 2012 12:18PM

For once I agree with Cramer.


Why bash Bernanke when it's so much more fun to bash Cramer's stock picking track record.

Sep 4, 2012 12:14PM
Typical Cramer analysis, blame someone else.  Bernanke is an epic failure.  Let's ask if we can say job well done, or, if Bernanke should guide the Fed for a few more years based on the record.  Look around you Cramer, it's not working.
Sep 4, 2012 12:04PM
Cramer, your problem is, you fail to see the price we all pay for today's liquidity. These artificially low interest rates come at a price to all americans. Hyper inflation will more than offset the the paltry GDP numbers created by debasing the dollar. This QE economy, as I like to call it, has created artificial market conditions in stocks, banking, construction, and housing. Stock market bubble created by the Fed. purchasing treasuries driving down yields to force investors into the market. Banks taking 0% money from the Fed. and speculating in stocks while discouraging savings with .1% interest rate on savings accounts and 1 or 2% on CD's forcing many older individuals into poverty. Construction of new homes and commercial properties when supply of vacant properties is at an all time high. Housing prices being kept afloat by a huge shadow inventory of dilapidating homes that the banks have been given the green light to hide off their balance sheets as liabilities by carrying them as assets. This is done by the false market to model, rather than the true value market to market accounting practice of the past. You see true market forces are not being allowed to determine the value of assets, and this no mater how you try to rationalize it is a recipe for disaster. The result is not if the big correction is coming, but when. 
Sep 4, 2012 12:02PM
Bernanke needs to be bashed. so  far he keep rate too low for to long.  but also congress will have biggest blame for crashing the dollar by not balancing the budget.  some like the amero like replace the dollar when dollar is dead.
Sep 4, 2012 12:01PM

Anyone who thinks that doubling the amount of $ in circulation was a good thing is in the pocket of the of the current admin. (Puffing on something good I'll bet.) Probably Kenyesian as well.


There is no way that the average person is better off now than when these clowns took over in 2009. Forget about what was done before. Obama RUNS this economy NOW.


They have had almost 4 years to make the changes needed to insure US solvency...they chose not to. Their ONLY agenda was to help those in their miniscule voting base so to ensure a huge turnout. It is the only chance they have at getting another shot at our pockets. I quit working to starve them of my $ and will continue to do so. Good luck spending MY $.

Sep 4, 2012 11:58AM
You think Twitter is going to be the next big thing?  Please.  It's nothing more than a giant waste of time.  I looked into it.  If you have lots more followers than who you are following, I guess you are awesome but is it really that?  After looking at a few pages of these so called awesome people and their nonsensical tweets, I came to the conclusion that all I wanted was my wasted time back.

If Twitter becomes an IPO, it's just another to avoid.

I see FB is still falling like a train.  Just as I thought.  Too bad I didn't short that stock.   Oh well, not going to do it now, though.

Sep 4, 2012 11:49AM

With Zero Interest Rate Policy, banks no longer have a legitimate way to earn profits?


WTF, banks get the zero rate money and can loan it at 3-4% higher rates if they weren't so stupid that they couldn't tell a qualified borrower from a fraudulent one.

Sep 4, 2012 11:35AM
Like a person who provides money to the homeless to buy booze and drugs, Bernanke has been keeping interest rates low so Congress doesn't feel the pain when it runs up huge annual deficits and debt. Bernanke is an enabler for an addict in their addiction.

With Zero Interest Rate Policy, banks no longer have a legitimate way to earn profits, so they turn to speculation and highly leveraged and risky investments called derivatives. Sure, the banks are greedy, and probably would have done them anyways. But instead of bailing out the banks, he should have taken a principled capitalist stand and let them fail. Now, he should break up the big banks before they fail, because the taxpayers can't bear the burden of another bailout. But when the big banks collapse, they will cause a major financial collapse.

Sep 4, 2012 11:33AM
If we were on the GOLD STANDARD, then all this bashing would never happen, but since we have no check and balances our Government and Fed have a free hand to do what they want, therefore deserve the bashing they are getting.
Sep 4, 2012 11:33AM
Sep 4, 2012 11:26AM
Will be 16 Triilion in debt by Friday.  We owe more than our entire econmy generates in a year!  More than all the GDP in Europe.  Wow!  And they want you to think everything is gonna be alright...How is it going to be alright.  Everything is based on growth....well I would hatet to break it to you...but you cannot grow forever!!!!!
Sep 4, 2012 11:19AM
Bernanke needs to be bashed. You need to be bashed. Wall Steet needs to be bashed. The Congress needs to be bashed. The President needs to be bashed. Corporations, like GM (who are investing billions of dollars abroad instead of here at home), they all need to be bashed. The shyster criminal banksters need to be bashed, prosecuted, and jailed. If this whole "keeping the interest rate at zero-percent interest" isn't just open manipulation of the markets by the FED, then I don't know what is. The FED policies are killing the average American retiree, eating into the meat of all pension plans and savings accounts.
Sep 4, 2012 11:07AM
He needs to be bashed. Like Geitner, he's all smoke and mirrors, with no substance. They both think they know what they are doing and while it may work for them, it doesn't do anything for the economy. They both make money and the rest of us pay for it.
Sep 4, 2012 11:00AM
Awe Cramer, your emotional outburst defending Ben Dover Bernanke tells us a whole lot about your motives and preferences.  While he's an outright thief; you are an outright idiot!
Sep 4, 2012 10:57AM
Jim not all of us make money off the poor and  wall street like you do some need interest income and Ben has not helped us. The banks owe Ben and they know it.
Sep 4, 2012 10:56AM
It´s not that Bernanke is to blame for everything, it´s just that he has been taking responsibility for doing what´s not his job. In a way, it makes room for the Congress to stay inactive and the economy don´t get reformed the way it needs to be. It stays in the doldrums.
Sep 4, 2012 10:47AM

Finally, I agree with Jim.  The gridlockers in Congress are looking for any excuse to blame anyone they can except themselves....President, Cabinet, SEC, Supreme Court, Wall Street, Energy, Health, Europe, China and the list goes on...especially to Bernanke all the while giving Greenspan a break when he should be villified for his lacksadaisical watch.


new slogan:  The Economy, it's up to us, stupid.

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