Understanding the Fed

The note below should be read together with professor Krugman's one I posted before.

There are two forces in contention here, since this blog is intended for high school students, I will simplify the issue even more, the 1% vs. the 99%. Unemployment concerns, directly connect with the 99%, inflation, with the 1%. Most of us want a job, the bankers want their money to be worth a lot. If the dollar looses half its value, the 1% sees its assets wiped.

What Ben S. Bernanke did, was to assure the rest of us that he won't work for the 1% just yet. The bankers will want him to increase interest rates all the way to heaven, so they can make a killing with all those assets they hold.

Professor Krugman will want professor Bernanke to do even more for the 99%.

Not this time.