Some of Ben Bernanke’s minions at the Fed (and to a lesser extent Ben himself) understand that they may have failed to plunge the stake through inflation’s heart. Anyone who has played serious golf (or, better yet, serious miniature golf, with or without vampires) can understand the problem that inflation presents.

What does golf have to do with inflation? It is simple. When putting, one has the best chance of making a putt if one aims to get the ball past the hole rather than to get the ball as close to the hole as possible. That is because the ball cannot go into the hole unless it travels a minimum of the distance to the hole. The downside of the intentional overshoot strategy is that when one misses, the next putt will, on average, be longer. Interestingly enough, this means that the most critical part of one’s golf game is the ability to make putts in the three to six foot range. Not coincidentally, this is one category in which Tiger Woods truly excels. If you are going to be a Tiger, you cannot always expect to have a tap-in for par.

Ben Bernanke is not yet in Tiger mode. He appears to be going for the perfect putt that makes its last rotation as it falls into the hole. The problem that he faces is that if the putt does not reach the hole, it may well roll all the way back to his feet and he will have to do things all over again. During the present pause, everyone is watching the ball roll toward the hole and we are waiting to see it if goes in. If the ball does not go far enough, Ben may have a much tougher second putt than he bargained for, windmill or no windmill.


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