Bernanke was critical

ARTICLE: Person of the Year 2009: Ben Bernanke, Time, Dec. 16, 2009

Reasonable choice, as this was the big event--and big danger--of the year. And this guy was #1 on the hot seat.

Comments

[Petrer]

I agree with the "house on fire" analogy with the steps Bernanke took with the US economy.But easy money has its problems when it becomes government policy to back worthless paper. You have Fannie and Freddie backing mortgages with no sense at all...and then you have investment banks and mortgage lenders taking advantage of this "insurance!" Hedge funds torched Lehman with AIG bond insurance and we as taxpayers paid for AIG's bailout, for one policy insanity...insurance is supposed to protect against risks - with the good faith of avoiding moral hazard and recklessness!

The issue is not too little regulation, the issue is the right regulation in the right places - especially with credit default swaps, or in other words, bond insurance!

Same reason why a consumer can't insure a $200,000 house for a million...the insanity is two fold...not only is risk perverse, the entire pool will pay for the fraud if it is policy to cover it!

[Steven J.]

I like the Bernanke choice. He saved the credit function.The watering down and eventual end of Glass-Steagall was not Ben's doing. Not sure he would of had the foresight to keep the seperation between Investment and Commercial banking in tact to prevent the collective undoing, but the tooth paste got out of the tube and he dealt w/ it in a way to keep credit moving.

His task in 2010 will be to keep the crappy undercapitolized regional banks from tumbling.