Some years ago, I went through a leadership program that our local Chamber of Commerce provided. In the program, one task we had was to write and deliver a short bio in front of the group. Now, I am an even-minded fellow when it comes to assessment of self. I learned some time ago that if you cannot tell yourself the truth, good luck telling anyone else the truth.
Anyway, when I wrote that bio, one thing I considered about me is my intelligence. Did I think myself smart, smarter, or smartest regarding other folks? Well, after I thought about it, I realized, yes, I am generally smart, and, sometimes, I am smarter than other folks in the room, but if I am the smartest guy in the room, the room needs to elevate its “smartness.” Essentially, I decided I was somewhere in the middle, and that worked just fine for me. I provide this information as context for what I am about to say …
A few weeks ago, I wrote in several articles that the idea inflation was under control seemed silly, specifically relating to the rising costs of food and gas here on the Central Coast. I suggested that the Fed’s definition of inflation (minus food and energy costs) did not make sense. I wondered in my writings how long it would take the focus to shift toward what I perceived as reality – inflation was already here.
Based on the words pouring from the media in the last few days, I would like to say that I got it right, that I was smart enough to see the man behind the curtain. And then today, I listened to Ben Bernanke speak at length about the economy, QE2, and the threat of inflation …
Now Ben Bernanke is smart, and when he explained the Fed’s view of inflation, something clicked in my brain. As I listened to him, I realized that it is his finger on the economic pulse, and behind his finger is a large group of equally smart people continually analyzing and debating the health of the economy. Thus, I, who has no advanced degree in economics from anywhere, am willing to yield to the Fed on this issue – inflation as the Fed measures it (core inflation only) means there is little upward pressure at this time.
Now this does not mean that inflation is not rising relative to food and energy. No, rising food and gas prices is real and meaningful, especially where I live, and rising food and energy costs is inflationary, but as it regards action on the part of the Fed, I defer. If the Fed believes QE2 (maybe QE3) and low interest rates for an extended period is in the best interests of the economic recovery, so do I. At some point, we all need to realize that no matter what each of us thinks we know, more than likely, someone else in the room is smarter. This in itself suggests a certain level of smartness, does it not? It also suggests a more realistic sense of self, which, in the long run, implies a more realistic walk through life. Ultimately, the import of this understanding is this: sometimes we just have to trust in those who are truly smarter than we are, but, as Ronald Reagan suggested some time ago, verification doesn’t hurt.
Trade in the day – Invest in your life
