While much attention has been directed toward Ben Bernanke's Nobel, the banking theories of Nobel winners Douglas Diamond and Philip Dybvig also need a second look.
Former Fed chairman Ben Bernanke and two other economists have received the Nobel in economics this year. Their work on banking is weak on causality and fails to recognize the damage done by the central bank.
The Fed is losing a lot of money. The Fed's stated plan is to monetize these losses and still report a positive capital and surplus position through the use of “creative accounting.”
When asked to quantify how a 75-point hike is better than a 50-point one, Powell had no answer. And will it work? Powell could only say "we'll know when we get there."
