I chose the title because the original work was a defense of religious views, written by Cardinal Newman, the famous religious scholar of the 19th. century, whose name you see on any Catholic campus. In my view, any doctrine that is arbitrary, that is not subject to falsification in the Popperian sense, or whose falsification is ignored, can be called religious. So in that sense I consider conventional, academic economics, as exemplified by the beliefs of Mr  Bernanke, as a religious belief system. Today, he made a speech to the Harvard graduating class which expounded upon the success (as he sees it) of monetary policy.

I’d like to pick out some examples for comment.

However, since Paul Volcker’s time, the Federal Reserve has been firmly committed to maintaining a low and stable rate of inflation over the longer term.

Mr Bernanke, perhaps you should have said, since the end of Paul Volcker’s time, to be clear. Mr Volcker made it clear that his inflation target was zero, not “low.” It is well known that you favor a fixed positive inflation rate target, 2% or so. This means that investors must earn 2% after taxes just to achieve a zero real return. In effect, the first 4%, at a minimum, of investment income is skimmed off by the government. In your chairmanship, actual price inflation has been much higher and is destroying the U.S. economy. Your “firm commitment” is a flat lie. Indeed, Mr Volcker has been sufficiently outraged by your inflationary behavior to break the traditional silence of retirement and publicly criticize your policy.

Productivity growth revived in the mid-1990s, as I mentioned, illustrating once again the resilience of the American economy. Since 1995, productivity has increased at about a 2-1/2 percent annual rate. A great deal of intellectual effort has been expended in trying to explain the recent performance and to forecast the future evolution of productivity.

Mr Bernanke, I’ll save you any further intellectual effort. Productivity improvement is an illusion resulting from the systematic understatement of price inflation, as a deliberate result of methodology changes beginning in the mid-1990s. These changes cause real output to be over-estimated, leading to the apparent productivity improvement.

Finally, as a central banker, I would be remiss if I failed to mention the contribution of monetary policy to the improved productivity performance. By damping business cycles and by keeping inflation under control, a sound monetary policy improves the ability of households and firms to plan and increases their willingness to undertake the investments in skills, research, and physical capital needed to support continuing gains in productivity.

Business cycles have been damped, Mr Bernanke, that is true, but by a series of asset bubbles inflated by excessively loose credit and low interest rates. As a result, if we examine the well-known identity that savings = investment, we find that contrary to your assertion, households have abandoned saving and investing. Their savings rate has been driven to zero or less, as they turned to speculation in view of the negative returns on their investments that your policies have guaranteed.

Even though average economic well-being has increased considerably over time, the degree of inequality in economic outcomes over the past three decades has increased as well.Yes, it has, to an extent only previously seen (in the U.S.) in the 1920s.

For the same reason. Wealth has come from successful speculation, conducted by those with an information advantage, or willingness to participate in the widespread frauds.

Most people, the wage earners, are seeing their real standard of living deteriorate daily. The concept of a breadwinner and caregiver has been replaced by dual incomes and daycare, yet living standards have continued to decline. Sir, shame on you.

The poor forecasting record of economists is legendary

Yes, because macroeconomics is not a scientific discipline and therefore cannot offer reliable predictions. Its “theories” are historicism, explanations retrofitted to history. As a result, your manipulations yield unpredicted and unforseen outcomes, Nicholas Taleb’s “Black Swans”. One is coming now.