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 BERNANKEThe U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.
More Ben Bernanke Quotes
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The benefit of appointing a hawkish central banker is the increased inflation-fighting credibility that such an appointment brings.
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The economic repercussions of a stock market crash depend less on the severity of the crash itself than on the response of economic policymakers, particularly central bankers.
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If Wall Street crashes, does Main Street follow? Not necessarily.
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The crisis in Europe has affected the US economy by acting as a drag on our exports, weighing on business and consumer confidence and pressuring US financial markets and institutions.
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The financial crisis appears to be mostly behind us, and the economy seems to have stabilized and is expanding again.
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It takes about two and a half percent growth just to keep unemployment stable.
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Indeed, in general, healthy investment returns cannot be sustained in a weak economy, and of course it is difficult to save for retirement or other goals without the income from a job.
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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.
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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.
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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.
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The Federal Reserve will not monetize the debt.
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If you want to understand geology, study earthquakes. If you want to understand the economy, study the Depression.
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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.
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A collapse in U.S. stock prices certainly would cause a lot of white knuckles on Wall Street. But what effect would it have on the broader U.S. economy? If Wall Street crashes, does Main Street follow? Not necessarily.
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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