Fed’s Bernanke to Clarify 2008 Reaction in Book

Ben Bernanke (AP Photo/Susan Walsh)
Ben Bernanke (AP Photo/Susan Walsh)

Ben Bernanke, who stepped down last month after eight years as chairman of the Federal Reserve, is planning a memoir in which he will focus on the 2008 financial crisis, the “Great Recession” that followed, and the Fed’s response to it.

“I want people to understand what we knew, when we knew it, how we made decisions and how we dealt with the enormous economic uncertainty,” said Bernanke, who expects to begin meeting with publishers within the next several weeks.

Bernanke, 60, says he will cover his entire career at the Fed, starting in 2002, when he joined the Board of Governors. He was appointed chairman in 2006 by President George W. Bush, a Republican, and reappointed by President Barack Obama, a Democrat. A former professor, Bernanke is currently a fellow at the Brookings Institution.

Few Fed chairmen confronted such profound challenges or became so controversial. Under his leadership, the Fed invoked all its conventional tools to salvage the economy. Once those were exhausted, Bernanke turned to extraordinary steps never before tried by the Fed.

Besides cutting a key short-term interest rate to a record low near zero and keeping it there for years, Bernanke launched a bond buying program that drove the Fed’s balance sheet above $4 trillion to try to accelerate growth and shrink high unemployment.

Bernanke was criticized by some liberals concerned about unemployment for not doing enough, and by some conservatives worried about inflation for doing too much. Bernanke said that the “political environment was pretty hostile at times” and noted that in 2011 he was called a traitor by GOP presidential candidate and Texas Gov. Rick Perry, who told a gathering in Iowa that “we would treat him pretty ugly down in Texas.”

“I’d like to be able to explain that [the Fed’s actions were] the right thing to do, and,” Bernanke added with a laugh, “to attest to my loyalty to the United States.”

Bernanke said he had not yet started the book, but had been organizing his thoughts and expected to take about a year to finish. He said he will write the book himself, although he will likely have help with research.

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