Ben Bernanke's tenure as the Chairman of the U.S. Federal Reserve is starting to wind down. He presided over the 2008 financial crisis and its aftermath and is holding what's expected to be his final official press conference.
Ben Bernanke will be remembered as the man who steered the U.S. economy out of the worst crisis since the Great Depression, a crisis he studied carefully as a professor of economic history. But like most economic luminaries of his generation, Bernanke stands accused of missing the warning signs.
"They should have acted more quickly, in retrospect, to head off this build up of this bubble economy that became so evident, particularly in the housing market in 2007. So they were slow. But once the crisis hit, I think he will get very good grades for moving aggressively and quickly and with the maximum tools available," Barry Bosworth, Senior Fellow at Brookings Institution, says.
When the crisis hit, Bernanke was one of the key architects of the bailouts of failing financial institutions. Earlier this week, he joined his predecessors to mark the 100th anniversary of the Federal Reserve, looking back at his crisis.
"Federal Reserve's extraordinary response to the financial crisis and the 'Great Recession' was in some ways nothing new. We did what central banks have done for many years in what they were created to do. We served as the source of liquidity and stability in the financial markets and the the broader economy and we worked to foster economic recovery and price stability," Bernanke says.
Under Ben Bernanke the Federal Open Market Committee slashed the U.S. benchmark interest rate to almost zero and then adopted an economic stimulus strategy previously rejected by the Japanese as ineffective, the purchase of trillions of dollars of government bonds and mortgage backed securities in an effort to further pull down the cost of borrowing and boost employment.
The final verdicts on that experiment haven't yet been handed down, and may not for years to come, because critics say there will be long term, unintended consequences for the world's over-reliance on cheap dollars.
As the Fed begins the process of unwinding its almost four trillion dollar balance sheet under his anticipated successor Janet Yellen in the coming months, those verdicts are likely to start coming in.
Source: CCTV
