Without Bernanke we would be in even worse shape

[cthulu2016]

They are all stooges, but there are stooges (Bernanke), major stooges (Geithner) and OMG!WHAT A FUCKING TOOL!!! (Greenspan)

Reading about the release (yesterday) of the transcripts of Bernanke's first year you really get a sense of a guy at least willing to look at the god-damned numbers.

At his first meeting Bernanke was following the conventional wisdom, agreeing with everyone there that the housing bubble was not likely to be a problem. Next meeting Bernanke was like, I'm sure you guys are right but I think we should think about the chances of some temporay dislocation...

By September, 2006 Bernake still expected a soft-landing, but

“I don’t have quite as much confidence as some people around the table that there will be no spillover effect,” Bernanke said.

By contrast, Geithner, who was then president of the Fed’s New York regional bank, expressed more confidence that the economy could weather the troubles in housing, saying the issue would be the impact on consumer and business spending. “We just don’t see troubling signs yet of collateral damage and we are not expecting much,” Geithner said at the September FOMC meeting.

It is not that Bernanke was right. (He wasn't.) But he was always the smartest guy in the room... a little less wrong and a little less arrogant.

http://www.suntimes.com/business/9989055-420/documents-show-how-fed-missed-housing-bust.html

[tularetom]

1. We sure as hell would be if Greenspan was still on the job

I think he should be hired back so he can be fired again. IMO the man is at least 50% responsible for the mess the country is in at the present time.

[jwirr]

2. I am not a Geithner fan but he was also correct. The impact has been on consumer and business

spending. It is kind of like that story about discribing the blind men discribing the elephant. Each discribed it but from their own position.

Just wish someone in that room had an answer to the problems.

[cthulu2016]

4. I think that may be an AP typo

I've read sevral articles on these same transcripts and the impression I took away was that Geithner thought the effect would be contained and would not affect spending much, but your reading of the AP snippet I posted is correct. Since it is the APs chracterization I can't say what they meant or didn't mean, but sice they set Geithner up as opposite to an expressed concern about spill-over I would guess they might have misphrased what they were trying to say. I think AP probably meant to say he did not think it would NOT affect private and business spending. But I don't know.

Here'a an annecdote from the Atlantic article:

"We believe that, absent some large, negative shock to perceptions about employment and earned income, the effects of the expected cooling in housing prices are going to be modest," said Timothy F. Geithner, the current Treasury secretary, who then was president of the Federal Reserve Bank of New York.

When Geithner was finished, Bernanke asked, to a round of laughter, "Anything to report on co-op prices in Manhattan?"

"As in many cases, I am not sure what you can take from the anecdote, but I guess some people say that you see a little of the froth dissipating," Geithner replied. "But I don't think the adjustment is acute.

[jwirr]

7. That makes it a whole different story. Thanks.

[Welibs]

3. 29 Trillion! The biggest heist in the history of the WORLD. He needs to go... now! Great article!

Check this out! (29,000,000,000,000) This takes him from the smartest guy in the room to the most deceitful guy in the room.

Why do these people think taxpayer money belongs to them?

[cthulu2016]

5. How was $29 trillion taken from the taxpayer?

You don't have to be pro-bailouts to recognize that there was never any $29 trillion transfer of government revenue or debt.

(If there had been our national debt wouldn't be $14 trilion.)

[banned from Kos]

6. Its $29 trillion today. Some days its $63 trillion, some days its $17 trillion - whatever number

comes to them.

Bernanke deserved his Time MOY award. He was slow to admit the problem but went full Keynesian when the problem blew up the economy.

He never could have undone millions of bubble mortgages anyway.