Bernanke looks a little uneasy in this video — http://www.ritholtz.com/blog/2009/07/qa-of-fed-reserve-chair-bernanke-by-alan-grayson/

I have been wondering about these entries in the balance sheet for some time. Finally someone else is curious. Franks was quite willing to cut off the line of questioning … coincidence?

Any comments Bob? Seems a little “funny” to have a very sudden factor of 20 increase in central bank swaps (approx $30B vs $600B)? At what interest rates? Why? Do we pay interest on their currency side of the swap? Same rates? Could some of that money be coming back to buy U.S. companies at fire-sale prices? Like the Chrysler “arrangement”? If the Fed can do that without congressional coordination, why did they bother to ask for the TARP funds?

Paranoia? Perhaps, but just because one doesn’t feel paranoid does not mean that you are not under attack.

EnjoyIt … What ever It is.

One thing we do know is government has influenced our capitalist system in ways it has never done in U.S. history. Are we capitalist? I would have rather lost all my money than lose my country. I’m afraid we are losing our country’s foundation due to the “experts” opinions for what if? I listened to Bernanke and Paulson throughout most of 2008 tell us the fundamentals of our economy were strong. Were those lies or did they just get it wrong? We entrusted them to make bold acts of socialism after they either lied to us or made the worse analysis in history. Either way we should have learned to not trust their “expert” opinion. So what about their IQ and SAT scores, judge them by their poor decisions prior to the fall crisis. If one judged them by their prior policy and analysis, then we would not acknowledge them as experts.

I really appreciate your sharing your understanding, experience and perceptions here for us mear mortals to review. Your approach and common sense all tend to help me when the paranoia attacks and conspiracy theories start to swirl. I saw the PBS special on Bernanke too. And I guess after that and your guidance, I am willing to give Ben the benefit of the doubt.

IQ and “common” roots or not, strong arm tactics tend to attract questions and concerns that are hard to keep from growing too large. I still don’t understand why it took so long to change the MTM accounting rules.

If I understood your earlier posts, much of the “crisis” was due to improperly assessed capital asset values based on a “market” that became illiquid and the application of rules that were intended for widely traded, very liquid securities. Additionally leverage limit exemptions for the big 5, ridiculous loan underwriting/approval practices, inept/inadequate government regulation and an “inbred” credit rating process made major contributions to the sudden loss of confidence and perceived systemic risks. The results and causes are still to be determined but, in time, I suppose all these factors and their impacts will be understood.

As for me, I am trying to take a deep breath and let the wiser, more experienced folks like you take the time needed to assess and recommend corrections to the system. If Ben did “what he had to do” then he will be lauded in time.

For now the inquiries serve a purpose. Our system is based on trust and confidence and honesty and the rule of law. The iquiries serve to strengthen these in time. Let’s not “cut them off at the pass” until the work is done to examine what happened, why and what it takes to prevent such future implosions.