 | Summaries and Customer Reviews are supplied by Amazon.com | “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. Brilliant but temperamentally cautious, Bernanke researched and wrote about the causes of the Depression during his career as an academic. Then when thrust into a role as one of the most important people in the world, he was compelled to boldness by circumstances he never anticipated.
The president of the United States can respond instantly to a missile attack with America’s military might, 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.
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 epic mistake. In this penetrating look inside the most powerful economic institution in the world, David Wessel illuminates its opaque and undemocratic inner workings, while revealing how the Bernanke Fed led the desperate effort to prevent the world’s financial engine from grinding to a halt.
In piecing together the fullest, most authoritative, and alarming picture yet of this decisive moment in our nation’s history, In Fed We Trust answers the most critical questions. Among them:
• 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?
In Fed We Trust is a breathtaking and singularly perceptive look at a historic episode in American and global economic history. |
Average Customer Rating:    The Fed and You The economic crisis has brought the standard emotion over the Federal Reserve to entirely new levels. I mean, if you thought people were opinionated about the central bank before the implosion of 2008, we are now in a whole new stratosphere. What is fascinating when analyzing the toxicity that exists over this issue is the extraordinarily non-partisan nature of it. Full blown anarchists like the Austrian economic camp believe the Federal Reserve to be far, far more evil than they do Al Qaida. Left wing collectivists are convinced that the Fed exists to be an eternal bailout for bankers with no consideration for their low income constituents. Conservative right wingers (such as yours truly) are mystified at the manner in which the Fed executes policy, eggregiously making self-fulfilling prophecies out of boom and bust cycles. The Fed has their critics in all corners. What I was hoping for out of In Fed We Trust by David Wessel is some sort of objective and thorough look at the Federal Reserve that could filter out a lot of the more cartoonish commentary. What we got was a very good and well-reasoned book that serves as a sort of play-by-play on the Fed's actions throughout the crisis. What we did not get, however, was a deeper ideological look at the role the Federal Reserve ought to play in monetary policy.
Clearly Wessel has better access to the central bank than the author of most of the other books on the economic implosion have thus far had. Sorkin's highly enjoyable Too Big to Fail hardly mentioned Bernanke, yet had remarkable access to the Treasury Department actors. Wessel, though, did a wonderful job getting inside the Fed, capturing meetings and specific conversations throughout the crisis from the major central bank characters (Bernanke, Warsh, Kohn, Yeller, Geithner, etc.). His underlying point is not too profound: Bernanke was a highly regarded academic whose major scholastic focus was the Great Depression, and this background and context set the stage for Bernanke's entire mangement of the economic crisis.
Critics and supporters alike acknowledge this. Of course, many believe that Bernanke understands the Depression wrongly so therefore was guaranteed to get this wrong as well. But the fact that Bernanke believed desperate actions were required - some of the same desperate actions that Bernanke feels the Fed of the 1930's was wrong to defer - is indisputable. The author backs off from making his own assertions about whether or not Bernanke was wrong (in what he ended up doing), but he does seem very willing to make the rather obvious claims that much of what Bernanke was responding to were self-caused problems. No serious commentator about the 2008 crisis will downplay the role that Greenspan's easy money policy of 2001-2004 played in priming the bubble pump that eventually blew up. But more specific to the 2007-2008 policy era, Bernanke did not see the systemic risk that the housing crisis was creating in the financial markets, and worse, until the nuclear explosion of September 2008, the Fed treated the matter like it was a crisis of liquidity, rather than a crisis of solvency. As John Taylor has shown us, it was this pivotal policy error that led to so much pain later and forced such dramatic action by the Fed later on in the process.
I plan for my own treatment of this crisis to more thoroughly analyze what the Fed did right and what the Fed did wrong throughout this mess. Wessel was not looking to provide such commentary. But suffice it to say, Bernanke thought he had to do whatever it takes and he went on to do so. History will judge some of these actions very critically, I am sure. And in fairness, history will judge some of the decisions more favorably. But what is most interesting about the present landscape is that it is forcing ideological conversations we have not had in the last 100 years about the role that the Fed ought to play in our society (if any). My own belief (contra my Austrian friends) is that there is a theoretical role for a central bank, though I would prefer no Federal Reserve at all to one with this "dual mandate" that Congress has presently put upon them (the dual mandate is that the Fed be responsible for price stability, and full employment; since so far they have never come close to creating either one, you have to wonder if either the mandate itself is flawed or there is some deeper fundamental flaw). I believe the Fed needs to focus on nothing whatsover other than price stability (i.e. a strong dollar and low inflation), but there is no doubt that the politicization of this institution has made that very, very difficult.
Readers wanting a final solution to the ills plaguing the Fed will not get it in this book, but they will get a wonderful analysis about a fascinating man (Ben Bernanke) and the ideological commitments that guided him (and still guide him) through the most extraordinary economic events of the last 75 years.
The future of world finance begins now Is the sub-prime mortgage the root of today's dramatic economic downturn? Was the inflated housing bubble the cause of today's financial meltdown? Did the financial engineering of banks and investors that created complex securities result in today's economic failure? All these questions and so much more of the bigger picture on the delicate workings of the incredibly complex economic web of the U.S. and world economy is at the heart of David Wessel's book, //In Fed We Trust: Ben Bernanke's War on the Great Panic (How the Federal Reserve Became the Fourth Branch of Government)//.
The Federal Reserve is entrusted with one mission: to protect the economy of the United States at all costs. It holds and wields power that turned it into the fourth branch of government, nearly equal in power to the traditional executive, legislative, and judicial branches. Wessel's //In Fed We Trust// will give you a clear-eyed view of what goes on inside the Federal Reserve, what economic forces they have to contend with, and how they acted on it. Ben Bernanke, the current Federal Reserve chief, and a small cadre of advisers vowed to do whatever it takes to avoid a possibility that, until last year, was unthinkable: a repeat of the Great Depression.
A perceptive look at a historic episode in American and global economic history, //In Fed We Trust// illuminates the financial drama in terms you don't need to be a Wall Street insider to grasp. While it is the story of the Bernanke Fed abandoning "failed paradigms" in order to "do what needed to be done," it is also a story about a handful of people - overwhelmed, exhausted, besieged, and constantly second-guessed - who found themselves assigned to protect the U.S. economy from the worst threat of their lifetimes.
This book provides an incredible overarching view of the state of today's economy and how it affects you.
Reviewed by Dominique James
In Fed We Trust This is a very interesting book about the Great Panic of 2007, 2008, and 2009. The author delves into the actions taken by the Federal Reserve, the Treasury, and the FDIC to attempt to stop the downward spiral of the stock markets worldwide, beginning with the development of the loan instruments that brought about the panic in the first place. There was more to the Panic than the news media told. If the news media had been more forthcoming - or if the Federal Reserve had been more open with the news media - perhaps the American people wouldn't have been so against the bailouts. The thing that bothered me about the book was what seemed to be an emphasis on the religious convictions or cultural background or ethnic origins of Ben Bernanke and several of the other participants. I couldn't help but wonder if the author would have emphasized those convictions/backgrounds/origins had they been of the WASP variety. Fed Apologist? The blasphemous title caps Wessel's journal-like recounting of the "Great Panic of 2008". Readers seeking the cause for our financial/economic difficulties will be disappointed. Readers will also find few nuggets in this narrative that have not been covered ad nauseam in the media. Out of fourteen chapters, only Chapter 2 merits close study, as it succinctly educates us on the long-forgotten beginnings of the Fed following "periodic financial debauches".
Wessel is close to most of the players at the Fed, Administration, and Wall Street. This is not a surprise. He makes his journalistic living covering them. As such, his book reveals lots of inside trivia. But do we really need to know that Bernanke's middle name is "Shalom"? Or that Bernanke swills down Dr. Pepper? Wessel needs to "make nice" with his government "dramatis personae" because to not do so would close the door to his future access. So, he appears very much to be a fan, more likely an apologist, for the Fed.
Does Wessel take time to really read what he has written? To do so he might discover that his very own recountings are damaging evidence of systematic Fed and Treasury arrogance and hubris. Wessel revels in a "whatever it takes" mantra that is both excuse and powerful testimony to the criminal usurpation of ill-gotten power by Bernanke, Paulson and Geithner. History will judge. Or maybe even before history, a grand jury. mysite.verizon.net/SidhuGroup
misleading book if you believe in what is been said in the book. you sadly are a fool. |  |
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