“The Greenspan Put” was the expression given to Alan Greenspan’s determination to cut US rates to keep the markets out of a sustained downturn.

Greenspan cut rates aggressively and most of Wall Street loved him for it. Ben Bernanke, his successor is less keen to cut rates, which is understandable given he made his name as an inflation hawk in a distinguished academic career.

One wonders however whether Bernanke’s teasing ways on interest rate cuts will earn his interest rate cutting process the rather ignominious title of the Bernanke Botox. The similarities between what Bernanke is doing on interest rates and Botox treatment are astoundingly similar.

Botox treatment, according to the official Botox website, is “a simple, nonsurgical, physician-administered treatment that can temporarily smooth moderate to severe frown lines between the brows in people from 18 to 65 years of age.” Certainly Bernanke’s cautious approach to cutting rates has temporarily smoothed the frown lines of investors around the world, including superannuants in Australia.

The site also notes that “within days there’s a noticeable improvement in moderate to severe frown lines between the brows, which can last up to 4 months. Results may vary.”

Unfortunately this is where the real Botox is outperforming the Bernanke Botox.

It was only in September that Bernanke cut rates by 50 base points, causing the Dow to rally over 300 points and hedge fund managers to reinstate their Maybach orders. Unfortunately the elation didn’t last as long as a Botox injection, with the market falling all the way back again until yesterday’s 300+ point rally on the Dow, driven by a belief a December Fed rate cut is coming.

For those investors who still believe that one more Bernanke Botox is somehow going to save the US from the coming recession, it’s worthwhile noting what the Botox site says when treatment is stopped “If you do not continue treatments, the moderate to severe frown lines between your brows will gradually look like they did before treatment.”