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…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

I generally leave the details of fiscal programs to the Administration and Congress. That’s really their area of authority and responsibility, and I don’t think it’s appropriate for me to second guess.
BEN BERNANKE

Details Responsibility Thinking
The more guidance a central bank can provide the public about how policy is likely to evolve the greater the chance that market participants will make appropriate inferences.
BEN BERNANKE

Chance Guidance Inference
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
A money-financed tax cut is essentially equivalent to Milton Friedman’s famous ‘helicopter drop’ of money.
BEN BERNANKE

Cutting Helicopters Milton
September and October of 2008 was the worst financial crisis in global history, including the Great Depression.
BEN BERNANKE

Financial October September
Monetary policy cannot do much about long-run growth, all we can try to do is to try to smooth out periods where the economy is depressed because of lack of demand
BEN BERNANKE

Growth Long Running
…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
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
The people who best use their advantages, or overcome adversity, and work honestly are those most worthy of admiration.
BEN BERNANKE

Adversity People Use
In fact, the world needs more nerds.
BEN BERNANKE

Needs Nerd World
We’ve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s going to drive the economy too far from its full employment path, though.
BEN BERNANKE

Employment House Thinking
Nobody likes to fail but failure is an essential part of life and of learning. If your uniform isn’t dirty, you haven’t been in the game.
BEN BERNANKE

Dirty Essential Games
So it’s important, as it affects overall levels of production and employment in the U.S. There are many domestic industries doing well in the United States, notwithstanding a strong dollar.
BEN BERNANKE

Country Dollar Employment Overall Strong
I don’t see much evidence of an equity bubble.
BEN BERNANKE

Bubbles Equity Evidence
The sources of deflation are not a mystery. Deflation is in almost all cases a side effect of a collapse of aggregate demand.. a drop in spending so severe that producers must cut prices on an ongoing basis in order to find buyers.
BEN BERNANKE

Cutting Ongoing Order
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 Federal Reserve has the capacity to operate in domestic money markets to maintain interest rates at a level consistent with our economic goals

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

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