“…Based on his recent public comments, Fed Chairman Bernanke seems determined to give the U.S. dollar the reputation of Egypt's Hosni Mubarak: an unwanted relic of the past that everyone agrees must go, but stubbornly clings to a privileged position. The dollar is currently the world's ruling currency, but, as with Mubarak, I believe that growing public discontent will spur regime change quicker than most pundits expect.
Clearly, the most significant problem facing central bankers around the world is the recent eruption of inflation, which is sparking unrest in Asia and the Middle East. With respect to this issue, Bernanke is alternating his responses through two different personas.
Sometimes he chooses to act like Baghdad Bob, the Iraqi Information Minister who, in the opening days of the 2003 invasion of Iraq, continued to deny the presence of American troops even as U.S. tanks rumbled behind him. The parallel to Bernanke's testimony to Congress today is striking. …”
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