The only thing worse than not having enough whiskey to sell to people is having vast rickhouses lined with whiskey-filled barrels that nobody wants to buy. It happened in the 1970s as many American consumers shifted away from whiskey, instead turning toward vodka and rum. This led to the demise and consolidation of brands, and it’s a hard-learned lesson which remains in the back of everyone’s mind even in today’s bullish bourbon market.
“Vast rickhouses lined with whiskey-filled barrels that nobody wants to buy….” Kentucky has more barrels of this elixir of the gods (4.7 million) than it does … citizens (4.3 million) reports The Atlantic Wire. Even this doughty bourbon drinker would have a problem making a material dent in a liquidity crisis of the magnitude described by Mr. Emen….
Now imagine how vastly more complex is the calculus for the demand for… dollars. Quantum physicist Niels Bohr once crisply observed, “It is exceedingly difficult to make predictions, especially about the future.”
The Fed, while operating with astonishing impunity, is by no means exempt from Bohr’s Aphorism. Dr. Richard Rahn, in the Washington Times:
The Federal Reserve had forecast the U.S. economy to grow about 4 percent near the beginning of each year for the last five years. But during each year, the Fed was forced to reduce its forecast until it got to the actual number of approximately 2 percent. (Other government agencies have been making equally bad forecasts.) These mammoth errors clearly show that the forecast models the official agencies use are mis-specified and contain incorrect assumptions.