EconomicCrisis.US

Federal Reserve Chairman Ben Bernanke, who helped steer the nation through the worst economic crisis since the Great Depression, was named TIME Person of the Year 2009 on Tuesday, eclipsing finalists who included President Barack Obama and House Speaker Nancy Pelosi.

“He didn’t just reshape U.S. monetary policy; he led an effort to save the world economy,” Time’s Michael Grunwald writes in the cover story, which will be on newsstands Friday.

Asked by Time in a Dec. 8 interview if bankers make too much money, Bernanke replied: “I think that bankers ought to recognize that the government and the taxpayer saved the financial system from utter collapse last year. And in recognizing that, I would think that bankers ought to look in the mirror and decide that perhaps there should be some more restraint in how much they pay themselves, given what the government and the taxpayer did to protect the system.”
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When the time comes, the Federal Reserve will raise interest rates to keep inflation under control, Fed Chairman Ben Bernanke said Monday, adding that that time could be far away.

With the U.S. economy still very fragile and unemployment so high, inflation isn’t a pressing problem right now, Bernanke said in a talk to a group of economists in Washington.

For now, getting the economy back on its feet is the top priority. “We have come a long way from the darkest period of the crisis, but we have some distance yet to go,” Bernanke said, according to the text of his remarks released in Washington. Read Bernanke’s speech.
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A trial in New York that seemed like a sideshow may hold pivotal lessons for lawmakers reshaping the regulatory system for U.S. financial firms.

Two Bear Stearns hedge fund managers, Mathew Tannin and Ralph Cioffi were found not guilty of conspiring to defraud investors, despite e-mails in which Tannin said he was so worried about the fund he had begun taking anti-depressants.

Prosecutors charged the pair knew the fund was in trouble, yet sold its merits with confidence to investors. The defendants lawyers contested that claim, saying prosecutors had used e-mails to provide “misleading sound bites” about the nature of working in finance.
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Since rolling out his anti-Great Depression policies in 2002, Ben Bernanke has had the dubious distinction of being the major contributor to the worst financial and economic crisis to hit in the post-World War II era. His theory and practice was to fight an enemy that did not exist in 2002 – deflation. As a result, he ended a long period of economic prosperity.

As chairman of the Council of Economic Advisors and a Federal Reserve governor, Bernanke strongly supported policies that pushed the federal funds rate to 1% and inundated banks with liquidity during 2002-2005.
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