Bernanke Having Serious Health Issues?

From his speech to the Economic Club of Indiana, Mr. Bernanke made some interesting statements.

These statements, coming from someone with such prestigious background in education and credentials, look contradictory to what Mr. Bernanke is capable of. I am seriously worrying about his health, specifically, his mental health. Maybe my worry is not warranted as no one remove him from his position and have him checked into a mental institution yet.

I am very puzzled about what he said,

"Many savers are also homeowners; indeed, a family’s home may be its most important financial asset"

"Only a strong economy can create higher asset values and sustainably good returns for savers."

Without selling the houses the savers have, they cannot profit from the increase in price of their houses. But selling their houses means they have to get another one somewhere. Since the savers are not irresponsible people who are going to buy some other houses that they cannot afford, why the hell would they sell their houses in the first place?

So selling the house is not a logical explanation for Mr. Bernanke’s statement.

What about borrow money against the inflated price of their houses?

These are savers who do not over spend. They are financially responsible people. If not forced to, they would not borrow against the equity value of their houses. Besides, banks do not lend money cheap to these people. Banks have better things to do with all the money they have thanks to a very generous government and central bank.

So borrowing money against the house is also not a sensible explanation for the Fed Chairman’s remarks.

As a summary, the point of "good return" or not is moot. And there is no "strong economy" from the actions taken by the Fed either.

Since I do not know Mr. Bernanke personally, I don’t know if he likes to deceive people. Assuming he is half decent, I guess I have to go with the other possibility that he has serious health problems affecting his ability to think straight.

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