DOW Down over 500 points today after Bernanke Looks to have Thrown in the Towel on the Economy On Tuesday

Fed Chair Bernanke should have listened to the three dissenters from Dallas, Philadelphia, and Minneapolis Feds when they opposed setting a date into 2013 which closed off some options and sent the wrong signal -- they were right as witnessed in the Dow falling 519.83, S&P 51.77, and NASDAQ 101.47.  Five major companies delayed announcing their 2nd quarter results until AFTER the market closed 11 minutes ago.

Figured there was going to be fallout from the Bernanke pushing the lid on interest rates into the middle of 2013 and there was.  The gains from yesterday were lost and more.

Big news is also out that the SEC is  investigating Goldman-Sachs to see if they broke bribery laws on Libya.  Goldman-Sachs is said to be too big to fail but just maybe they are too big and forgot what it was like to be honest.  There are too many people with Goldman-Sachs ties in the Government and just maybe it is time to start looking outside of Wall Street to fill positions.

Another bad day for Wall Street and the American economy thanks to Bernanke from what we have been hearing on Bloomberg.

Bernanke has thrown in towel on economy
By Paul R. La Monica @CNNMoney August 10, 2011: 1:43 PM ET 

NEW YORK (CNNMoney) -- Is the Federal Reserve waving the white surrender flag? It sure looks that way. 

The Fed made the unusual (and unprecedented) move on Tuesday to tell the market in plain English that it intends to keep rates near zero for the next two years! 

That is disappointing on many levels. First and foremost, it is a crystal clear sign from Ben Bernanke and other Fed members that they think the economic recovery (if one could still call it that) will remain tepid for a long time. 

That is probably one of the reasons that the post-Fed euphoria on Tuesday afternoon on Wall Street quickly gave way to despair again on Wednesday. 

This is not good. The Great Recession may have technically ended in June 2009. But for many Americans, this current malaise is just an extension of the problems that first began to surface in 2007. Lost Decade anyone? 

Yes, that's a Japan reference. And it's sadly apt. The Fed, by pledging to leave short-term rates "exceptionally low" for what will eventually amount to a four-and-a-half-year stretch, is essentially guaranteeing that long-term bond rates will remain persistently low -- just like in Japan. 

The yield on the 10-year Treasury is at about 2.13%. Yields actually briefly touched the all-time low from December 2008 of 2.03% on Tuesday after the Fed announcement before bouncing back. 

Would it be any surprise if the 10-year soon had a 1 handle on it like there is for Japan's 10-year bonds? That would be extremely troubling. The time to emulate Japan's economy was in the 1980s. Not now. 

Recession 2.0 would hurt worse 

It's even more ironic since Bernanke criticized the Bank of Japan in a paper in 1999 while he still was a professor at Princeton. The title? "Japanese Monetary Policy: A Case of Self-Induced Paralysis?" 

I have several more bones to pick with the Fed. Why did the central bank feel that it was a good idea to put a specific time frame on when it will raise rates in the first place? Even if it was mid-2012 that would have been silly. 

I'm all for transparency. And the Fed under Bernanke is clearly a lot less opaque than it was under Alan Greenspan. But sometimes the Fed can give the markets, to use teen texting parlance, TMI. 

The Fed has now effectively boxed itself in regardless of what the economy does over the next few months and year. Sure, it seems impossible now to think that the economy will pick up dramatically anytime soon. But keep in mind that economists, the market and the Fed are often wrong. 

Excerpt:  Read More at CNN Money