Fed Overseer Ron Paul Says He Doubts Bernanke Can Prevent Inflation Surge

Representative Ron Paul, a Texas Republican who next month will take control of the House subcommittee that oversees the Federal Reserve, said he’s concerned the central bank won’t be able to prevent an outbreak of inflation.

Fed Chairman Ben S. Bernanke said during an interview broadcast Dec. 5 on CBS Corp.’s “60 Minutes” he was “100 percent” confident the Fed could keep inflation below 2 percent and reverse its accommodative monetary policy when necessary. Policy makers “could raise interest rates in 15 minutes,” if needed, he said.

“This optimism of Bernanke who says that when the prices start to go up, he can turn that off in 15 minutes, I don’t think he fully understands the subjective theory of value and how prices have a psychological reason for going up, too,” Paul said today on Bloomberg Radio’s “The Hays Advantage” with Kathleen Hays. “When people lose confidence, prices go up, and you can’t turn that psychology off in a minute”

Continue reading - Bloomberg - Fed Overseer Ron Paul Says He Doubts Bernanke Can Prevent Inflation Surge