More than any other single institution, the US Federal Reserve drives global capital markets with its decisions and communications. While its interest rates are set by a committee, for almost a century, the Fed’s philosophy and operational approach have been moulded by one person: the Chair of the Board of Governors.
In the first series of The Chair, Tim Gwynn Jones talked to authors of books about the Fed's foundational Chairs – Marriner Eccles, Bill Martin, Arthur Burns, and Paul Volcker. In this second series, he covers the people who chaired the Fed through the post-1990 period of financialisation, globalisation, and – perhaps today – deglobalisation.
Episode two of the second series covers the life and crisis-era times of Ben Bernanke, the man who filled Alan Greenspan’s big shoes and ran the Fed from 2006 to 2014. A shy but world-renowned monetary economist and historian of the Great Depression, Bernanke was left holding the proverbial bomb when the financial system came close to collapse in 2008. To discuss Bernanke, Tim is joined by David Wessel, author of In FED We Trust: Ben Bernanke's War on the Great Panic (Crown, 2010).
“It wasn't obvious when he was appointed to the Fed in 2006 that having somebody who had spent their life studying the Great Depression would be well equipped to be Alan Greenspan's successor,” says Wessel. “I have sometimes said it was a like being a paleontologist. It's very nice that you know a lot about dinosaurs, but what use is that to us today until one day a Stegosaurus appears on the horizon. And it was remarkable good fortune for the country and the world that there was a guy who happened to have studied all the mistakes that the Fed made in the 1920s and the 1930s in a position to do something about it when a situation, not all that dissimilar, appears both to his surprise and to almost everybody else's”.
Wessel is two-time Pulitzer Prize winning journalist who now runs the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution. For 30 years, he worked at the Wall Street Journal - reporting mostly from Washington and covering economics and the Fed.
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