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TheStreet Open House

The Boy Who Cried 'Exit Strategy'

VANCOUVER, Canada (Bullions Bull Canada) -- Bloomberg News and Federal Reserve Chairman Ben Bernanke have been at it again, performing their own little version of the legendary Abbott & Costello "Who's on First?" skit. They call theirs "exit strategy."

In the latest installment, from March 11, we have Bloomberg in its role of straight man Abbott trying to make four years of empty promises of a monetary "exit strategy" by Costello (played by Bernanke) sound admirable.

The best Bloomberg could do is to proclaim Bernanke is "provoking mystery" with year after year of his doubletalk. This is followed by paragraph after paragraph of the same (mandatory) "maybe he should/maybe he shouldn't" drivel we have been subjected to since 2009. Time to update your script!

Most readers are familiar with the fable "The Boy Who Cried Wolf." For amusement, a shepherd boy began periodically shouting out "wolf," in order to rouse all the other villagers and force them to run all the way out to the sheep's pasture before determining for themselves that there was no wolf.

However, the villagers soon caught onto this game so fewer of them began heeding the false alarms. Finally, and ironically, on the day a wolf actually appears in the pasture no one at all responds to the boy's real alarm.

While the boy of the fable engaged in his serial lying purely for the purposes of amusement, it's certainly easy to ascribe other, probable motives for such lying on the federal level.

Our economies have what is known as a "business cycle." While "full business cycles" are generally deemed to stretch out over roughly a decade, there are clear and obvious sub-cycles within these longer intervals. Specifically, throughout our modern economic history the average length of any particular growth cycle is a little more than three years, with 40 months being the number most typically quoted.

Yet, with the supposed U.S. "recovery" now four years in length, we still see Bernanke engaging in the same absurd song and dance. Going all the way back to the early months of this mythical recovery Bernanke has been promising an "exit strategy" every few months -- like a lethargic cuckoo clock.

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