Capitol Hill Correspondent
Speaking in front of the House Financial Services Committee earlier this morning Federal Reserve Chief Ben Bernanke announced a surprise move targeted directly at his 2004 investment in the Florida real estate market. Bernanke spoke for nearly 3 hours during the Q & A session on Capitol Hill with topics spanning from inflation to the high price of commodities, and finally his action to lower the monthly payment on his South Florida rental property following the expiration of an 3 year ARM.
Mr. Bernanke notes that the Federal Reserve is more than aware of the "moral hazard" risk that is assumed by focusing the monetary policy of the worlds largest economy on one 3 bedroom condo conveniently located 15 minutes from Ft. Lauderdale with easy access to I95.He adds that the "pergo flooring and addition of an outside gas barbecue" have made the property a steal for both seasonal visitors or full season residents. Bernanke went on to defend against rumors that he simply did not understand the package of documents from Washington Mutual that explained the automatic rate hike of his mortgage after the 3 year ARM expired last March.
He does remain confident that the "foreclosure rate" of this specific property should remain near zero and that he is willing to consider additional measures to raise credit liquidity should his wife continue to purchase non-consumer cyclical items such as the last 8 releases from Jimmy Choo.
Wall street reaction to the testimony was mixed as investors weighed the disclosure that Mr. Bernanke would not follow through with his plan to print money in order to fill a pinata at his daughters 7th birthday later this month.
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