Bernanke Gets Second Term

Fed chair defends response to financial crisis

(NEWSER) - Ben Bernanke defended the government’s response to the financial crisis today before Congress, saying regulators’ various approaches reflect different aspects of a unified strategy, MarketWatch reports. “We’re not making it up,” the Federal Reserve chief said. “We’re working along a program that has been applied in various contexts. We’re not completely in the dark.” More»

Paul Krugman argues that we need more inflation, not less

(NEWSER) - Ben Bernanke has become a popular punching bag for the right lately, with people like Ron Paul and Rick Perry trying "to bully the Fed into doing exactly the wrong thing," writes Paul Krugman in the New York Times . "The right wants the Fed to obsess over inflation," constantly warning that it will explode any day now. They're wrong—inflation has remained stable just below 2%—but even if they weren't, Krugman thinks a little inflation would do us good. More»

Candidate returns to Washington to spar with Fed chief

(NEWSER) - Ron Paul may have a presidential race to run, but he's never too busy to return to DC to do a little Fed bashing. Paul grilled Ben Bernanke today, declaring in his opening statement that "what we are witnessing today is the end stages of a grand experiment," reports the Wall Street Journal. The Fed's control of the money supply isn't working, said Paul, who once again called for a return to a gold and silver standard, notes ABC News . He even asked Bernanke whether he did his own grocery shopping. "Yes I do," came the reply. More»

Fed says inflation on target, but unemployment high, growth sluggish

(NEWSER) - Don't get too excited about that pending economic rebound . The Federal Reserve's announcement it will keep interest rates super-low into 2014 is a key sign that the US economy is years away from truly recovering, reports the New York Times . Yes, the economy has picked up "moderately," said the Fed in a statement, but jobs are still scarce and growth is expected to be sluggish for the foreseeable future—2.7% in 2012, 3.2% in 2013, and perhaps as high as 4% in 2014. “What did we learn today? Things are bad, and they’re not improving at the rate that they want them to improve,” said the chief US economist at HSBC. More»

Geithner, Bernanke, others missed signs of the pending collapse

(NEWSER) - The Fed released transcripts from meetings in 2006 today that reveal just how badly its top officials blew it on the looming housing crisis, the New York Times reports. The industry was showing signs of distress, but the Fed's attitude boiled down to, eh, no big deal. The officials clearly did not grasp how "deeply intertwined the housing sector and financial markets had become," writes Binyamin Appelbaum. They would get the picture soon enough. Some highlights:

• Timothy Geithner (then with the New York Fed): “We think the fundamentals of the expansion going forward still look good," he said in December 2006. A few months earlier: “We just don’t see troubling signs yet of collateral damage, and we are not expecting much."