U.S. central bankers decided yesterday to buy as much as $300 billion of long-term Treasuries and more than double mortgage-debt purchases to $1.45 trillion, aiming to lower home- loan and other interest rates. The Fed kept its main rate at almost zero and may keep it there for an “extended” time.
The moves sparked the biggest drop in 10-year Treasury yields since 1962…Economist Richard Hoey said Bernanke has created the “Rambo Fed,” referring to the Sylvester Stallone character skilled with weapons.
OK, so Hoey is a fan of the Rambo Fed, and like Ben Bernanke, John Rambo did have a proclivity for piloting helicopters (and slitting throats, but let’s hope the ex-Princeton Professor doesn’t have to get quite that aggressive).
I am one of the foremost Rambo scholars in the United States and I’m one of the only people on earth who saw the last installment in the theater. Using my otherwise useless knowledge of the First Blood iconography, I will take Richard Hoey‘s allusion a step further.
Extrapolating this First Blood analogy, I suppose we are all P.O.W.s locked up in this bamboo jungle prison that is the ’08-’09 Great Recession.
And then, I suppose, The “bad guy”, Sheriff Teasle (Brian Dennehy) would be housing prices.
Or, we could say that First Blood Part II‘s Marshall Murdock (to whom Rambo remarks “I’m comin’ for you”) could represent the unemployment rate.
Either way, Rambo’s (Bernanke’s) only friend, the stalwart Col. Samuel Trautman, would be best represented by the Obama administration, who will stand by the Fed’s rapidly growing balance sheet no matter what.
We can only hope that the Rambo Fed will come across as formidably against it’s enemies as Col. Trautman warns the Sheriff his boy will:
Teasle: Are you telling me that 200 of our men against your boy is a no-win situation for us?
Trautman: You bring that many men, just remember one thing.
Teasle: Oh yeah? What?
Trautman: A good supply of body bags.