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Ben Bernanke Calls For More Regulation

January 11, 2010 by  

Ben Bernanke calls for more regulationSaying lax regulation had caused the housing collapse of 2008-2009, Fed Chairman Ben Bernanke suggested the financial industry needs more oversight going forward.

In this way, the nation’s top banker denied that expansionary monetary policy should be blamed for the financial and economic woes of the last two years. In recent times, the Fed has come under criticism for keeping interest rates low, which some say fueled the excesses in the housing market.

The chairman, however, offered a different view. "Borrowers chose, and were extended, mortgages that they could not be expected to service in the longer term" Bernanke told a meeting of the American Economic Association, quoted by the Financial Times.

"This description suggests that regulatory and supervisory policies, rather than monetary policies, would have been a more effective means of addressing the run-up in house prices," he added.

Bernanke is currently undergoing Senate hearings leading up to the vote on his confirmation for the second term as Fed chairman, and the issue of the monetary policy prior to the financial crisis is high on the agenda of some lawmakers.

Many of the central bank’s critics in Congress will be fighting this year to limit its regulatory and oversight role, something Bernanke and President Obama are likely to oppose.

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  • Robert

    Is he kidding? What about the roles Barney Rubble (Franks) and Cris (I didn’t know I got VIP treatment and a payoff) Dodd on their roles in pressuring the banks,Fannie Mae and Freddie Mack to loosen lending standards? And what is this going to cost us taxpayers? Just what we need, more government regulations and control. I believe all these people should take a touble dose of a fleet enima and get rid of all the crap that’s in their minds.

    • DaveH

      Ben Bernanke is just a Big Government sycophant. It was both easy money and Government pressure on banks to lend to marginal borrowers that led to the real-estate bubble.
      There were many people predicting a real estate collapse long before it happened. My son, a loan officer said they were giving “Stated Loans” to people who claimed ridiculous salaries. I wondered many years ago – where is that omniscient Government of ours? Little did I know that they were actually encouraging the risky loans.

      • Robert

        You got that right. The morons in Washington are blaming the Banks for all the problems. I guess none of them can afford mirrors.

  • Disgusted

    Slowly but surely one regulation and supervisory policy at a time the government is gaining control of more and more. When is everyone going to wake up? I know when…..when it’s too late. Those of us who see what’s happening and are trying to speak out about ir are being called extremists, nut jobs, crazies and anti-american. Unbelievable!

    • Robert

      I kind of like being called an exteremist, nut job, crazy anti-American. It has a nice ring to it. I’d rather be called that than a Muslim. Now that’s a real fithly word to call anyone.

      • Norm

        There are some pretty “filthy” Christians as well.

        • DaveH

          Yep, especially the Liberal ones.

        • Robert

          Is that because we eat pork products?

  • fritz

    vote them all out and lets have term limits

  • Janice

    Go ahead and put a tighten noose and strangle our Nation to death with all your regulations!

  • kodiak60

    What they need to do is just roll back the legislation that Clinton signed, taking away the regulations that prevented all this chaos! After the Great Depression, they instituted regulations on the banking industry that prevented all this from happening. However, bank lobbyists pressured Congress into creating legislation that Clinton signed into law, taking away the safeguards that were instituted after the Great Depression. That action set us up for this new Great Recession. That’s where the blame should be… on the Congress of THAT legislation, and Bill Clinton, for signing it!

  • Terry

    It was not just any bank that intentionally caused the Great Depression, it was the Federal Reserve. An that wasn’t the only thing they’ve done. Follow the money. He who holds the gold, make the rules. The key to the economic enslavement of America can be found in the Federal Reserve, a privately held bank that does not answer to Congress or the President. On the contrary, its the other way around. The real conflict is the People vs the Bank. All other conflicts are more likely to be either symptions of or distractions for. Research ‘History of the Money Changers’.

  • Meteorlady

    Who does he think he’s kidding? The Fed is the cause of most all economic problems in this country. We never should have allowed them, we never should have gone off the gold standard and Bernanke is the biggest cheer leader for this type of action. We need to end the Fed!

    • DaveH

      I think you’re on to something with the Gold standard. But as far as the Federal Reserve goes, while I do think they should answer to the Congress, I don’t know that giving Congress the money printing responsibility would be any better. It is common practice in Countries with Government control of money creation to get out of control.
      I do strongly feel that any money created should be collateralized. And that doesn’t include “the full faith and credit of the government”.

      • Robert

        DaveH. Our government says our debt is backed by our GNP. Do you know what GNP looks or smells like because I’d like to get some and put it under my matress and save it for a rainy day. Too bad we’re heading for a 1000 year flood.

    • http://Don'thaveone Sally

      Most people in the country don’t know who the FED is, they think it is a controlling arm of the government. It is unconstitutional and always has been just like the IRS that Wilson put in JUST TO PAY THE COSTS ONLY OF WWII. You see where that led! Does anyone know the site to go to to see now who is involved and ownes the Fed? It use to be Deutche Bank of Germany but there are in big trouble also. Could be HSBC (main office Hong Kong ROC)has controlling interest now.

  • cerebus23

    You know what really cause the banking collapse? the federal government mandating that banks give loans to low income people for houses period.

    Starting under carter and increasing under every president and congress all the way to george bush and ending up at a staggering 55% of all loans had to go to low income people to buy houses.

    It was that federal regulation that fueled the banking collapse, it was not predatory loaning or housing bubbles it was the fact that banks were forced to hand out high risk loans at a ever increasing rate and was increased even furthur in the midst of a massive housing bubble.

    Lack of regulation are you that ignorant stupid or just plain a big government anti free market leftist mr banking chairman that you say we need more government regualtion rather than dismantling or at the very lest scaling back the regulations that caused this mess in the first place. can also heap onto that pile the role acron played in pressuring lenders to give out bad loans, but any part they play i am sure paled in contrast to that the feds did.

    • Tinwarble

      Well, lets not forget that it was also people who earn $30,000.00 a year buying a house that cost $300,000.00. Were was the personal responsibility, or at least the common sense, that they couldn’t afford that.

      • Fed Up Gal in NM

        BullsEye….Target Reached! Thank you, Tinwarble!

        Fed Up Gal

      • libertytrain

        Exactly – they seem to be blaming everyone else for their own irresponsibility. We do have to take responsibility for the dumb things we do – not to say the banks weren’t being greedy as well – but….

  • Norm

    In the US we live by the golden rule. If you have the gold you make the rules. It’s called pocketbook democracy.

    • Tinwarble

      Actually if we lived by the golden rule there would be other people in charge. Now we live by the “who ever can print more dollars” rule, & unlike the people with the gold, those that are making the rules now have nothing to back them up.

  • Art K

    It is just the opposite, the lax Congressional overseers, need to be prosecuted for turning a blind eye to what was going on, yes, and even profiting from their complicity in the goings on that led to this. Oh they didn’t think the house of cards they were buliding would fall on their watch, but it did. The problem is the administration that needs to procecute this is the fox that’s in charge of the hen house. Therefore, coming from that branch of goverment is the “need for more regulation”. i.e., more government interference (read: More politicians getting rich off someone else’s misery.

  • M Btok

    Please, Help Us Give Ben Bernanke the “Proverbial,” Boot!
    All opponents of the illegal, unconstitutional, and failed Federal Reserve system must now realize that this is the hour of action. It is time for every serious intelligent person to send two e-mails and place two phone calls to the Washington and local offices of their senators demanding that they stop Bernanke. Obama should also be warned that Bernanke is an insult to the American people. Those who have been complaining about the Fed for decades now have a real chance to do something about it. These chances are very rare, but this is the best one in many, many decades. Even Paul Adolph Volcker, who had been responsible for an obscene 22% prime rate three decades ago, had an easier time getting reconfirmed than Bernanke. Once Bernanke has been defeated, it will be time to secure the ouster of Treasury Secretary Geithner, the former head of the New York Fed and currently the most visible member of the entire Obama cabinet. The basic outlines of a criminal indictment for Geithner on tax fraud and securities fraud can be culled from virtually any daily newspaper. Geithner ought to be accompanied on his trip home by White House economic czar Larry Summers, the woman-hating former president of Harvard who managed to destroy about a third of the Harvard endowment as a result of his fanatical devotion to the riskiest of financial derivatives. This and more will be within our reach if Bernanke can be checkmated over the next week or two. Check out what Government is doing behind your back at:


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