James Saft is a Reuters columnist. The opinions expressed are his own.
A financial advisor who counsels 57-year-olds to lock themselves into large loan payments until they are approaching 90 probably ought to be looking for another line of work.
And yet here we have Ben Bernanke, perhaps the most powerful man in the global economy, following exactly that course. The Federal Reserve Chairman is putting his own assets on the line to walk that reflationary walk in a move that tells you a lot about the theory, practice, risk and rewards of the economic remedies he champions.
Bernanke, who turned 58 this week, refinanced his mortgage in September, less than two years after the last time he refinanced, according to a report in the Wall Street Journal, citing sources and public records.
Bernanke owes $672,000 on his house, about 80 percent of its appraised value. The mortgage has a 30-year term, implying that repayments are fixed and that it likely carries an interest rate of about 4 percent.
The most recent refinancing came not long after Bernanke launched Operation Twist, a Fed bond buying program partly intended to drive down mortgage rates and thus hopefully stimulate the economy.