Fed Chair Bernanke Reflects on a Year of Crisis
As difficult as the past year and a half have been financially and economically, it could have been much worse were it not for the response of policymakers around the world, Fed Chairman Ben Bernanke said in a speech at the Federal Reserve Bank of Kansas City's Annual Economic Symposium in Jackson Hole, Wyo., in late August.
A scholar of the Great Depression, Bernanke noted that in the 1930s, policy was "largely passive" and international cooperation difficult.
Speedy, forceful actions halted slide
The past year has revealed a couple of fundamental lessons, Bernanke explained. For one, a financial crisis exacts a huge toll in both human and economic terms. Secondly, financial disruptions cross borders, and no major country has been immune in the current crisis.
Passivity held great risk
He also warned that challenges lie ahead.
"We must work together to build on the gains already made to secure a sustained economic recovery, as well as to build a new financial regulatory framework that will reflect the lessons of this crisis and prevent a recurrence of the events of the past two years. I hope and expect that, when we meet here a year from now, we will be able to claim substantial progress toward both those objectives."
August 31, 2009