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Economics is a highly sophisticated field of thought that is superb at explaining to policymakers precisely why the choices they made in the past were wrong. About the future, not so much.

Ben Bernanke

Speaking as somebody who has been happily married for 35 years, I can’t imagine any choice more consequential for a lifelong journey than the choice of a traveling companion.
BEN BERNANKE

Journey Travel Years
Under current law, on January 1, 2013, there’s going to be a massive fiscal cliff of large spending cuts and tax increases.
BEN BERNANKE

Cutting Important Law
If you are asking me if I would advocate that the Chinese go to greater flexibility in their exchange rate, I certainly would.
BEN BERNANKE

Asking Chinese Rate
The American people are among the most productive in the world. We have the best technologies. We have – great universities. We have entrepreneurs.
BEN BERNANKE

Entrepreneur People Technology World
I don’t fully understand movements in the gold price.
BEN BERNANKE

Gold Movement Price
The amount of currency in circulation is not changing. The money supply is not changing in any significant way.
BEN BERNANKE

Currency Significant Way
I’d throw dollars out of helicopters if I had to, to stimulate the economy.
BEN BERNANKE

Dollars Economy Helicopters
I assure this committee that, if I am confirmed, I will be strictly independent of all political influences… essential to that institution’s ability to function effectively and achieve its mandated objectives.
BEN BERNANKE

Essentials Independent Political
Nobody really understands gold prices and I don’t pretend to understand them either.
BEN BERNANKE

Gold Gold Price
Both humanity’s capacity to innovate and the incentives to innovate are greater today than at any other time in history.
BEN BERNANKE

Humanity Incentives Today
Among the largest banks, the capital ratios remain good and I don’t expect any serious problems . . . . among the large, internationally active banks that make up a very substantial part of our banking system.
BEN BERNANKE

Banking Ratio Serious
Importantly, in the 1930s, in the Great Depression, the Federal Reserve, despite its mandate, was quite passive and, as a result, financial crisis became very severe, lasted essentially from 1929 to 1933.
BEN BERNANKE

Depression Financial Great Result
How much would you pay to avoid a second Depression?
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Borrow Depression Great Pay
Education – lifelong education for everyone – from toddlers to workers well advanced in their careers – is indeed an excellent investment for individuals and society as a whole.
BEN BERNANKE

Career Education Money
Not all information is beneficial.
BEN BERNANKE

Beneficial Information
…the Federal Reserve has the capacity to operate in domestic money markets to maintain interest rates at a level consistent with our economic goals
BEN BERNANKE

Goal Investing Levels
It’s true that the Federal Reserve faces a lot of political pressure and is unpopular in many circles.
BEN BERNANKE

Circles Political Pressure
The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.
BEN BERNANKE

Months Past Risk
Every effort needs to be made to try and offset the costs of Katrina and Rita by reductions in other government programs, especially those that are wasteful, duplicative and ineffective.
BEN BERNANKE

Effort Government Trying
It is not the responsibility of the Federal Bank – nor would it be appropriate – to protect lenders and investors from the consequences of their decisions
BEN BERNANKE

Decision Economics Responsibility
Achieving price stability is not only important in itself, it is also central to attaining the Federal Reserve’s other mandate objectives of maximum sustainable employment and moderate long-term interest rates.
BEN BERNANKE

Employment Important Long
The Federal Reserve will not monetize the debt.
BEN BERNANKE

Debt Federal Reserve Reserves
Under a cold turkey strategy, at each policy meeting the Federal Open Market Committee would make its best guess about where it ultimately wants the funds rate to be and would move to that rate in a single step.
BEN BERNANKE

Committee Country Moving
The basic prescription for preventing deflation is therefore straightforward, at least in principle: Use monetary and fiscal policy as needed to support aggregate spending.
BEN BERNANKE

Business Principle Support
I served seven years as the chair of the Princeton economics department where I had responsibility for major policy decisions, such as whether to serve bagels or doughnuts at the department coffee hour.
BEN BERNANKE

Coffee Responsibility Years
Life is amazingly unpredictable; any 22-year-old who thinks they know where they will be in 10 years, much less in 30, is simply lacking imagination.
BEN BERNANKE

Imagination Thinking Years
The GSEs are adequately capitalized. They are in no danger of failing.
BEN BERNANKE

Capitalized Danger Failing

Economics is a highly sophisticated field of thought that is superb at explaining to policymakers precisely why the choices they made in the past were wrong. About the future, not so much.

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Economics is a highly sophisticated field of thought that is superb at explaining to policymakers precisely why the choices they made in the past were wrong. About the future, not so much.

Related Topics

Popular Authors

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