In Fed We Trust: Ben Bernanke's War on the Great Panic
by David Wessel
"Whatever it takes..."
That was Federal Reserve Chairman Ben Bernanke's vow as the worst financial panic in more than fifty years gripped the world and he struggled to avoid the once unthinkable: a repeat of the Great Depression.
The President of the United States can respond instantly to a missile attack with America's military, but he cannot respond to a financial crisis with real money unless Congress acts. The Fed chairman can. Bernanke did. Under his leadership, the Fed spearheaded the biggest government intervention in more than half a century and effectively became the fourth branch of government; with no direct accountability to the nation's voters.
Brilliant, but temperamentally cautious, Bernanke researched and wrote about the causes of the Depression during his career as an academic. Then when thrust into the role as Fed chairman, he was compelled to boldness by circumstances he never anticipated.
Believing that the economic catastrophe of the 1930s was largely the fault of a sluggish and wrongheaded Federal Reserve, Bernanke was determined not to repeat that mistake. In this look inside the most powerful economic institution in the world, David Wessel illuminates its inner workings while revealing how the Bernanke Fed led the effort to prevent the world's financial engine from grinding to a halt.
In Fed We Trust answers:
What did Bernanke and his team at the Fed know -- and what took them by surprise? Which of their actions stretched -- or even ripped through -- the Fed's legal authority? Which chilling numbers and indicators made them feel they had no choice?
What were they thinking at pivotal moments during the race to sell Bear Stearns, the unsuccessful quest to save Lehman Brothers, and the virtual nationalization of AIG, Fannie Mae, and Freddie Mac? What were they saying to one another when, as Bernanke put it to Wessel: "We came very close to Depression 2.0
How well did Bernanke, former treasury secretary Hank Paulson, and then New York Fed president Tim Geithner perform under intense pressure?
How did the crisis prompt a reappraisal of the once-impregnable reputation of Alan Greenspan?
- adapted and revised from publisher
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