>> >> i've think of our legacychiln is that our grandchildren no that research and help others.e >> i solvay's in annual family show. [laughter]a >> this is thest last questioni. >> my a neece was diagnosed with multiple sclerosis is abl hhere anything she can take wit away from you to inspire her ? >> six years old i never friend with a child and that

is really hard and. kw i think for her to know in her lifetime there will be more and better more progressive and aggressive treatments that she will live in a place threshold of ths nerve regeneration where people that, you know, have spinal cord injuries and all -- there are things happening that are so exciting. i wish you could all be in the meetings that i'm in. and i'm sure, maria, you too where you see what's coming and these brilliant engineers and scientists that are working to make and improve people's lives so that even if she does lose some function, that there's hope again with regeneration of cells and treating not only just the

symptoms, but getting to the point where your function is going to be better. and that's the future. >> you still feel like you're carrying a bag of rocks? >> i feel as though my bag of rocks has been made so much lighter by all the people that i know who came up to me all the time and said i'm praying for you, i'm with you, we love you. it was so extraordinary to have that experience of going across the country and having that kind of response. >> has this given you a sense of purpose that perhaps you didn't have? you stepped up to become a spokesperson, advocate, you're out talking about something you never imagined. >> i never thought -- >> so has it given you an advocacy that has been, that is empowering to you? >> yeah. i mean, it gives you purpose. i mean, it's wonderful, and you just want to help. and, you know, there's a lot of

people that can pull the wagon. so i will suggest that if people would think about buying this book, we will sign it just right after this, and my proceeds go directly to research, not to buildings or anything else, directly to research. and we are going to make a difference in millions of people's lives through that. >> so i want to -- [applause] that is a perfect segway to wrapping up this conversation with ann romney. as she just mentioned, she's going to be in there signing books. the proceeds of this book do go to research. there's a lot of exciting things going on in ms, in alzheimer's. we hope you will join us both to find a cure for these diseases and by supporting her center, you do that. we're going to have many of these architect of change conversations, so let us know who you think would be

interesting to hear from and to remember that, as she was saying, you weren't talking about this until it happened to you, and you could have stayed under the covers, you could have rolled over and said i'm not going to step up, i'm not going to speak up. and every single person, as i started this conversation by saying, has the power within them to speak up on something that can change another person's life. and i hope you will think about that when you leave today, about your own voice and your own power and take a page from her, be inspired by her, informed by her and ignited in your own life. so thank you so much for joining us, ann. >> thank you. [applause] [inaudible conversations]

>> guest: i started right away as you point out i stopped on saturday and monday i started on the book. i had a lot of material the federal reserve i had my own e-mail i had dozens of emails and it is very useful

because you can go back realtime to see what was happening also a daily news clippings so i had a wealth of material in day public affairs person to help with the process so i was done in 14 months. >> host: as a decade that the fed during the most turbulent economic times in our lifetime so what did you learn about yourself? >> guest: the purpose was to go through the whole process but one of the

things that i learned first of all, is hindsight israel have a story is said to have better that had to happen but as things are happening you balance was a possibility against another so i see myself as a risk manager to assess the chaotic situation to find the right way for word bed it was very difficult. >> host: many years ago is reader's digest to say be proud of the man i have become.

you don't strike me as a narcissistic man or egocentric but as you go back to reconstruct emails and interviews were you pleased with the way it unfolded? >> we made mistakes up to the crisis running into the crisis into 2007 that the crisis was getting severe. and broadly speaking we did the right thing and with the first contact with the enemy of the plans are disturbed a lot of things on the margin the couldn't the difference but once we determine redo this aggressively we get the

main things right. >> host: let's talk about your background small talent to reach kids and as you have said it in your book you were a dodger fan because of sandy koufax but a lot of readers may have been surprised you worked at south of the border. i am guilty i don't know that the people of the east coast selby everybody does the you are a middle-class kid but what does that do for you? >> that is a place where the

economic situation is tough i worked as a construction worker and i got some appreciation how hard it is to put food on the table and pay the red if you don't have a lot of education i would is part that we were a jewish terribly and mitty were southern baptist but i also led to all public schools it in the drugstore we knew everybody in town so the whole the experience was getting to know ordinary americans facing challenges. >> host: you tell stories of your grandmother in

connecticut you with some of the front porch talking to her we were born similar type we all had paris our grandparents that talked about the depression and. your grandmother talks about the paradox of the issue because tell us about that but fortunately about the country you had talked enough about the depression that led you to graduate school into steadied the depression. >> guest: i used to sit on the front porch with my grandmother she would tell me stories of her youth in her thirties in she said she was proud because her

children were able to wear new shoes every year. in some cases maybe they did not even have shoes because the shoe factory had shut down the fathers have lost their jobs so there is not enough money to provide shoes to the kids. all they had to do was open a factory in produce shoes but the workers were still there fidelity sel was inspired at age six elevator was called the holy grail of economics.

and i spent a lot of time working in researching. >> host: go to 2007. i came to the senate in j. gary m. put on the committee was the sleepy banking committee. they had done in serbia the oxley but my wife and i live in 44105 it meets in the first half of 2007 there were four closures in that's it coated in india there in the united states of america. but at least until all bear stearns there wasn't that much attention because of

the house if -- the housing crisis without a lot of reasons it was predatory lending and will was happening with manufacturing why did the fed missed this? but ohio was the middle of it period all the way from appellation '02 inner-city. why did we see how serious that was. >> guest: i spoke of foreclosures plenty of times but some were probably unavoidable with seems like

there was not enough effort to modify those mortgages every year very concerned to talk about foreclosures enter problems. and from the macro economic perspective with those empty houses creating plight to pay attention to that issue. >> host: i see that and i heard those statements but also i would say the consumer protections with the authority particularly

prior to although i've not casting any aspersions but you were more into it and your predecessors, but i began to hear from people on consumer protections and predatory lending that they were there for us. >> guest: using the were predatory is critical because i talk about that at link in my book. this stems back to the '90s. one of those big extensions was between predatory lending that was illegal lending and then legitimists of prime lending.

but then to get into a home to participate in the american dream. but that there wasn't a more aggressive effort to cut that off. already as greenspan said was already illegal. vs a sub prime lending. >> host: i will go from a different angle. i also don't think they spoke about those dealings. i don't think that was captured or regulated in the sense they perceived it to be in their own career or financial interest but they were open to the regulatory

burden that should not be excessive in the competitive market forces i worked in the institution where lobbyists are omnipresent you may remember after dodd/frank and now it is halftime i imagine a place where lobbyists come matt you regularly over time because our staffing endure regulators 10 to hear from the most tv to it is easy to get socialized. to stay in the white house

tuesday after running get my public opinion that doesn't strike me as the place to go and smell. that does not strike me that way. but to be aware of the pain that it wishes to understand that. >> that the reserve bank in the country they would report to west it is and wrong at all. and well before the crisis from a philosophical perspective and then to be

more dynamic but if they have sufficient capital to have to watch carefully. >> it wasn't done right to either. >> host: i will ask you the different way why did t.a.r.p. funding with the bank bailouts work better than what we tried to do with the hamp? with your conception to reluctant members of congress why did that work better than what we tried to do? >> guest: we needed to stabilize wall street

because we were afraid it would collapse of a financial system on the economy. and the treasury lead the efforts for modifications in refinance that were owned or partially nationalized i was aware full was building space to oversee the use of the target money -- t.a.r.p. money but there was a lot of effort from their president obama was redoing before i don't have a satisfactory answer but don't have a satisfactory answer but it was hard to do

they defaulted often records were incomplete but i share your frustration but deal bombing administration was working on this. >> host: you did not show it is in your face splendors stay in you were not necessarily having the time of your life. because we wanted to give you radiance but knowing that criticism could come back but here's what you wrote.

although i testified dozens of times i always disliked them. why is that? >> it really wasn't about the oversight to make leading questions or make speeches. there is a lot of conflict involved. >> i did olmos state -- 80 times and died acknowledge the importance to do that that doesn't mean they enjoy it on their personal basis. >> the fed share testifies twice a year by law once to

the senate beguine committee and the third time it was required by the legislation that is very important that it has a dual obligation one is to combat inflation to try to restrain inflation and. some of these questions may not sound like i am complimented you but you take that employment side of that dual mandate as seriously as the inflation side. in the fed share takes that equally seriously. with a cast of 10 others to

have a serious san sobering conversation with the calls you needed to make that day in the town east of columbus and i got a call from the majority leader to say we leave you on the phone at 2:00 with chairman bernanke. this is september before that 2008 election of obama and bear stearns had already been saved at that point. fannie and freddie and aig those were about to happen. to allied the problems to say we need legislation but maya regulate election said

libya for page ability to pass immediately one of the vagueness i do on hard votes to make for and against it and felt without i wrote best but i will ever cast and worst political votes i will ever cast knowing that it was painful i am not exactly a wall street guy but i also knew what was best for my country. the stock market dropped 700 points. you remember that very well. but what you did with t.a.r.p. in the auto rescue was immense importance per cry want to go to the next

up to talk about the nine brothers in the actual target issue that the heading is from that financial crisis to the satisfaction of heat-moon treasury it is hard to forget although it is easy to forget details from that day in 2008 with the last four months of the year to the first half of 2009 many of those were manufacturing jobs and you right over and over how this will help with

a tax cut stimulus that you supported in retrospect it being cute thought was inadequate but this is another recovery act stimulus i'm sorry for the long intro why was it so hard? after redid that it was overwhelming republican opposition to fight austerity to help you with the monetary policy why was it so hard for you and secretary posts in the? you were reappointed three times by president bush. i know about your politics but clearly paulson was appointed by the republican in frustration so why was this so hard for them to step up?

>> guest: they had the wrong idea basically. the deficits for very large that generated as a deficit as well there was a lot of fear going during with high interest rates or inflation in resaw more rapid austerity. and i said so at the time. >> i specifically referred getting this question. we kept her credit card. >> host: white you give your teenage daughter a credit card? >> that is another question.

but government spending or tax cuts produce - - reduce the deficits so the disease is better than the cure. so that led to resistance and i said so at the time it in particular the federal stimulus was significant of said of local level contraction. so that was offsetting of

the net fiscal support. >> with they became to come back in this more recession recently where we had job growth since the auto rescue to have the a drag on that there were fewer government jobs doing everything you could on the monetary policy level but as keynes first

suggested public spending to replace private spending the economy is still in free fall with interest rates near zero. the economy needed fiscal help but during the fall below street journal editorial in then to endorse obama for president i wasn't endorsing a candidate but just as the fiscal stimulus but one of the things you just said my biggest frustration but not sure to

talk more precisely to return to their republican critics but interest rates are very low. >> why couldn't you be more prescriptive or stronger in your words? this was an extraordinary time why couldn't you do that? >> guest: i think -- to think that would have worked ? >> i was cautious. we needed to be less austere down because with that

longer-term balance instead. into violate the implicit contract but my general rule you can think this is wrong to talk about the direction of policy trap more fiscal support to stay away from a tax cut because that is what congress could work out among themselves. in with that tax cut i do

more harm than good. >> host: maybe it is not fair to use but how old surprise schumer on conservatives of the tea party but also conservatives who see the fed as the institution to blame the fed >> but understanding they will not pass the cheers for touche to build so what had to bother you precisely with members of congress is no

question. >> did you speak played the about that? >> and prosperity at least but the debt limit it isn't about constraining government spending and not paying your bills is a deadbeat been to do. so to take the lead to be engaged in that. >> host: with the concern to some of us in increasing

provincial institution. those that made up 18% of gdp in of large part of what happened with bear stearns with 18 percent of gdp in by 2010 it hasn't changed much since. and not as a result the dodd/frank by bloomberg populated those large bays have 80 basis points because of the financial markets that they are too big to

fail to be at the expense of the other babies m. blumberg said $80 billion so it is something like that. but they're not too big to fail but to big to regulate should we be concerned about their political power? >> guest: but the steady at least suggests the two big to fail funding a vintage because of dodd/frank. >> but what i would say that dodd/frank and that agreement we had internationally and there

are two things and do the new capital rules under dodd/frank so the biggest things have to have more capital with a higher percentage of capital and lie there is subject to the fed oversight. >> supervision is tougher but on the of this side moving forward in a constructive way the ability to unwind but the main thing i would point out to is it

is more costly to be big and what you see is companies talking about drinking per -- investing because the paper today made a discussion and then to avoid that extract capital. so that practical effect why there is a necessity but in the hands of the regulators to move us in the right direction.

>> host: the pronouncements or the words of ben bernanke the give us save the low production that the fed is looking at the big banks if you cannot be unwound without the government infusion of the t.a.r.p. government infusion like palo was with lehman brothers you will have touche divest i'm not naskhi which bakes you think but which will precipitate but that was it a anticipation

produce see that happening. >> guest: yes i do. but the alternative would be so pointing to another recent development that total loss absorption capacity they had to have enough capital to be converted to capital should they come close to failing. >> is to intensify the large residual institution they do

provide services andey do provide services and jobs. and his much's relate community banks the ada is had we get them to move the the right direction? the best way is to have an effort to be big to take away that funding a vintage. >> host: this is a small number of years ago but that has been flat. >> i would note the anecdotal evidence no longer assumes every support.

i don't want to overstate this but things are moving in the direction overtime. to have a lot of flexible tools to get the regulators in the right place. with the coordinated said end treasury in are you concerned about that? >> but on the lid is very destructive some things are less effective tuesday with the changes could be made

that for the most part has been pretty constructive. but dade debate making adjustments. with the affordable care act >> that isn't too much? but though one proposal is to eliminate title to with the strength in vagrancy rules. is that the lesson from lehman brothers?

the goal is to protect the creditors. unfortunately that was not the main public port -- public purpose. we were concerned of the ability of the overall system. that was a lot of money which by the way it goes against the idea but then trouble with a pepsi was with the collapse of the overall system to give a lot of discretion to stabilize the system only those things that give the highest return.

the liquidation authorities about the stability to protect the creditors in general so that is why i would prefer to see the liquidation authority that is dedicated to the main part - - objective is to the overall system. >> host: i said the pronouncements of 2015 don't move markets it was amusing how in 2002 when you joined the administration as the fed governor and then became the chief economic adviser but then went back to chairman of the fed that your link bridgehead to be

much more precise. how does that work out at home? [laughter] do you talk differently? [laughter] i am accused by my wife to quit talking like that at home. >> to take the fight to the american people? [laughter] but i understand the pressure. >> my home life was a tremendous relief talk about my personal experience my wife was good to give me an oasis to think about something else. >> page 42 you talk about a

book you were writing when you got the call that change your life to go to washington and go beyond the federal reserve working on the age of dilution of central bankers created the great depression 120 pages into the book. what will the next ben bernanke, and -- what title with they give to a similar book not the solutions but though the dow up? >> guest: probably something like to complacent or something like that one of the aspects of the '90s and early 2000 and under the surface the risk was

building not only the housing in the mortgage sector better broader financial system that led to the conflagration of 2008. that is the terms of the period before the crisis to identify excessive confidence to be that problem with u.s. count dodd/frank is working i always have to say we're paying close attention to what is happening you have to make sure you are paying close attention. >> host: one of the first things i thought about was how so many people in this country or on wall street were in financial services were rewarded for

risk-taking they got the rewards but the public have lost jobs looking at 800,000 jobs per month the loss of the stock market. a lot of that has come back of course, but i was talking to tom currie and he talked about one of the things that bank culture has changed every major financial institution has a risk officer the stature to set the table, not making money for the firm but pulled them back are we doing out well enough to have the authority in the support of the board of directors to tell a

company you cannot do that it is too risky? >> of course, janet yellen is testifying today on the ongoing project but before the crisis they had risked officers but they run not necessarily at the table or given enough attention were not taken seriously. it is a big part of the strength is a provision to make sure they have a high-profile, they have the information they need and the banks can assess their own risk. before the crisis if house prices dropped 20% how does that affect your portfolio? david city would get back to in a couple weeks they could not answer. now the stress test to get

permission to pay dividends to show you have enough capital and the ability to monitor your risk i don't want to see the problem is solved but things are moving in the right direction the oppression of the regulators but another aspect has to do with the compensation structure people are paid a bonus you could take a lot of risk during the day then move on and to another company so now they insist on a compensation package with callbacks if that money you did not get or payback to create a longer-term perspective by the ways structure compensation when

i went to claim problem solved or far enough. >> we last saw had a reputation to send people to wall street with complex financial vehicles with various kinds of cdo's. our young people less likely to do that now? >> there is still interest at princeton and elsewhere but statistics show the best and brightest are not necessarily headed tool street like in the '90s early 2000's. >> host: like they come to ohio to manufacture it what that would be for society not but what they don't join austria is