Even as the financial crisis rages, Ben Bernanke says it’s time for broad regulatory reforms to stem future crises. Bernanke said today “too big to fail” institutions should be more tightly watched, perhaps by his Federal Reserve. He also admitted that the US hadn’t been prudent with the glut of capital that poured into the market in recent years, the Wall Street Journal reports.
For the future, Bernanke proposes a raft of new regulations, a limited system of money-market insurance, and changes to deposit insurance. For now, world governments must act forcefully, and occasionally in concert, to restore credit flow. “Until we stabilize the financial system, a sustainable economic recovery will remain out of reach,” he told the Council on Foreign Relations.