The title, obviously a “tribute” to Hitchcock, well captures both Bernanke´s “strenght & weakness.” I reproduce a chart that I put up earlier because it clearly shows that.
Things are getting even more complicated because Vincent Reinhart, the man who came up with the adopted “forward guidance” expression that was so successful in 2003: “Encouraging investors to expect short rates to be lower in the future than they currently anticipate”, now says:
“If monetary policy is a science, then we in the private sector are the little white lab mice upon which they experiment,” Mr. Reinhart wrote. “However, as opposed to their counterparts in the hard sciences, the effectiveness of Fed officials in white lab coats depends in part on how well we white mice understand the plan.”
The Morgan Stanley economist said the Fed is “falling short” in its efforts to provide a clear stated monetary policy regime, and he blamed it in part on the difficulty of getting FOMC members to all agree on the best way to proceed.