If Australia finds it has a strong Australian dollar, and it has higher unemployment, then it would have to respond, and that would either be by increasing domestic demand or by weakening its own currency.
— Ben Bernanke
Clear communication is always important in central banking, but it can be especially important when economic conditions call for further policy stimulus but the policy rate is already at its effective lower bound.
We should see better and more direct measurements of economic well being.
You want to put the fire out first and then worry about the fire code.
The biggest downside of my current job is that I have to wear a suit to work. Wearing uncomfortable clothes on purpose is an example of what former Princeton hockey player and Nobel Prize winner Michael Spence taught economists to call 'signaling.'
There are a number of institutions globally where the Federal Reserve typically leads the U.S. effort to work with financial regulators from other countries, and we try to, to the extent possible, establish international standards for how - the amount of capital a bank should hold, for example, or how much.
I was a professor at Princeton University. And, in that capacity, I studied for many years the role of financial crisis in the economy.
The banks have accounts with the Fed, much the same way that you have an account in a commercial bank.
Interest rates are used to achieve overall economic stability.
Actually, I'm a Republican.
The Fed's independence is critical.
The best solution to income inequality is providing a high-quality education for everybody. In our highly technological, globalized economy, people without education will not be able to improve their economic situation.
Economics has many substantive areas of knowledge where there is agreement, but also contains areas of controversy. That's inescapable.
Honest error in the face of complex and possibly intractable problems is a far more important source of bad results than are bad motives.
There are limits to monetary policy.
The crisis in Europe has affected the U.S. economy by acting as a drag on our exports, weighing on business and consumer confidence, and pressuring U.S. financial markets and institutions.
The Fed is totally open.
Because financially capable consumers ultimately contribute to a stable economic and financial system as well as improve their own financial situations, it's clear that the Federal Reserve has a significant stake in financial education.
Imperfect substitutability of assets implies that changes in the supplies of various assets available to private investors may affect the prices and yields of those assets.
Aggregate statistics can sometimes mask important information.
I and others were mistaken early on in saying that the subprime crisis would be contained. The causal relationship between the housing problem and the broad financial system was very complex and difficult to predict.
I have spoken about deficits, and I think deficits are important because they address broad economic and financial stability. We need to talk about that.
In September 2008, the two largest housing mortgage companies called Fannie Mae and Freddie Mac, which were government-sponsored enterprises, which hold hundreds of billions of dollars of mortgages, because of the losses they took on the mortgages, they essentially became insolvent, and the government had to take them over.
I got into economics because I wanted to make things better for the average person.
All the Federal Reserve can do is make loans against collateral.
If you take a candy bar in the short run, it gives you a burst of energy, but after a while, it just makes you fat.
To the extent that bank panics interfere with normal flows of credit, they may affect the performance of the real economy.
Banks will have to win the confidence of their customers through fair dealing, making good loans, and remaining financially healthy.
Income inequality is troubling because, among other things, it means that many people in our society don't have the opportunities to advance themselves.
I think most of us would agree that people who have, say, little formal schooling but labor honestly and diligently to help feed, clothe, and educate their families are deserving of greater respect - and help, if necessary - than many people who are superficially more successful.
If you are not happy with yourself, even the loftiest achievements won't bring you much satisfaction.
Indeed, in general, healthy investment returns cannot be sustained in a weak economy, and of course it is difficult to save for retirement or other goals without the income from a job.
The crisis and recession have led to very low interest rates, it is true, but these events have also destroyed jobs, hamstrung economic growth and led to sharp declines in the values of many homes and businesses.
Investment banks manage to go bankrupt through their investment-banking activities, commercial banks manage to go bankrupt through their commercial-banking activities.
As an educator myself, I understand the profound effect that good teachers and a quality education have on the lives of our young people.
As you know, in the latter part of 2008 and early 2009, the Federal Reserve took extraordinary steps to provide liquidity and support credit market functioning, including the establishment of a number of emergency lending facilities and the creation or extension of currency swap agreements with 14 central banks around the world.
Textbooks describe economics as the study of the allocation of scarce resources. That definition may be the 'what,' but it certainly is not the 'why.'
My proposal that Fed governors should signal their commitment to public service by wearing Hawaiian shirts and Bermuda shorts has so far gone unheeded.
In the past, Federal Reserve chairmen have not generally gone directly to the public.
The stress on the financial system in the fall of 2007 was significant, but not so significant as to threaten the overall stability of the U.S. economy, although it did lead to the beginning of a recession at the end of 2007.
I came home from school one day, and there was a phone call for me. And I picked up the phone. They said, 'This is the Harvard Admissions Department. We'd like to let you know that you're accepted in the freshman class.' And I said, 'Come on, who is this really?'
A little humility never hurts.
In a slow-growing world that is short on aggregate demand, Germany's trade surplus is a problem.
Long term, I have a lot of confidence in the United States. We have an excellent record in terms of innovation. We have great universities that are involved in technological change and progress. We have an entrepreneurial culture, much more than almost any other country.
China is growing very quickly and is clearly becoming an important player in the world economy.
If you're in a car crash, you're mostly involved in trying to not go off the bridge, and later on you say, 'Oh my God!'
Remember that physical beauty is evolution's way of assuring us that the other person doesn't have too many intestinal parasites.
If the fiscal cliff occurs, I don't think the Federal Reserve has the tools to offset that event.
Monetary policy is not a panacea.
Well, optimism's a good thing. It - makes people go out and - you know, start businesses and spend and do whatever is necessary to get the economy going.
