and the federal reserve bought that deal. now, i don't think that's -- i think most people think that was a mistake subsequently, certainly, including the federal reserve. but i don't think i would interpret that as a lack of independence by the federal reserve. they thought they were contributing to a reasonable economic policy for the country. they weren't giving up on inflation in their view, they were turning it over to fiscal policy. it didn't work out, and that's when the inflation really got underway. i am struck myself reading some of this stuff, the nixon white house conversations among themselves or with arthur burns, and i did not realize at that time -- by that time i was in the treasury -- the degree of pressure that was brought upon purposes. it was pretty rough in terms of pressuring burns to be easier. i don't think burns was ever as easy as the white house would have wanted. so i'm not sure it's a real abdication of independence, but there's certainly a hot -- a lot of pressure brought upon him. now, around t

when i became chairman of the federal reserve in 79 the federal reserve staff, already in a recession, it would appear in that quarter. i don't think they were alone in that prediction. we went ahead and tightened money. what was surprising is the tight and very strongly, fall and winter of 79/80. it continued to grow. the economy was still growing. the economy, this is an artificial recession, the economy dropped in what is called a recession in response to credit controls, to put up and that came of the clear sky. he announced one day on credit controls and the federal reserve applied credit controls. we didn't like the idea of credit controls so we rated crandall controls as mild as we could make them and exempted every form of credit except credit cards and single payment installment loans. home credit was exempted. those are the two big sources of credit. the last president of the united states says we will restrict credit, everyone was coming up their credit cards and we pay credit-card balances and of money supply wind and the economy -- so i want to be patriotic and stop spend

when i became chairman of the federal reserve the federal reserve staff had been predicting a recession. other we were already in a recession or if not it should appear in the next quarter or two. i don't think there were in that prediction, but what surprised me is we went ahead and tightened money anyway. traditionally if the board had been listening to that kind of forecast they would not have taken it. what was surprising was we tightened very strongly in the fall and winter of 79 and 80 because the economy continued to grow. i could not believe it. a forecast of recession command interest rates went to 20% at that point, and the economy was still growing. the economy and in addition, i still think this is an artificial recession. the economy dropped into an artificial recession and response to the controls of president carter. that came out of the clear sky. he announced one day credit controls. the other reserve apply the credit controls. we did not like the idea. so we made him as mild as we could possibly make them and exempted every form of credit except credit cards and single

the federal reserve has come at enormous distance. you may not be awar but in 1994 the fed didn't even announce when it changed the rate target and now of course we have an after meeting statement with folks of like the european central bank in almost any other bank we have detailed minutes that release the weeks after the meetings. we release full transcriptf a five-year lag. we have extensive speeches and to some of these and other mechanisms, so we are a transparent central bank and we have made a lot of progress in that front. on press conferences, it has been a difficult decision as we thought about it. on the one hand, the real time transparency is very important and valuable piece of it all the other hand we don't want to create unnecessary uncertainty and volatility in the financial markets by saying things that may be misinterpreted if they are to ad hoc. that being said, as i said, i put a lot of vow to the entrance currency. we moved in the direction that we are looking very seriously at whether we have a committee in fact

improved quality that surveillance mechanisms and better use of the broad range of skills of the federal reserve staff. we have created a new office of financial stability within the federal research which will monitor financial developments across a range of markets and firms and coordinate with the council on the other agencies to strengthen oversight. the federal reserve is committed to its longstanding practice of insuring all of its rulemakings are conducted in a fair, open and transparent manner. accordingly we are disclosing our public website of all communications with members of the public including banks, trade associations, consumer groups and academics regarding matters subject to a proposed future rulemakings under the act. we also implemented measures within the act to enhance the federal reserve transparency. in december we released detailed information regarding individual transactions conducted between december 1st, 2007 and july 20, 2010 across a wide range of the federal reserve liquidity programs and we are developing the necessary processing is to disclose the information co

>> congressman, the cfpb is located in the federal reserve on in a narrow sense that the federal reserve pays the bills. we have no oversight or control, the controller is coming coming from the treasury and i think they are the ones who would be most appropriateoñppation of ? you were just kind of the landlord and the paymaster? >> we're doing our best to help them get set up. there's a lot to be done in terms of just hiring people in setting up an i.t. system and so on, but in terms of policy making and so on, they are completely independent of the federal reserve. we have no say whatsoever. >> you were making no recommendations about who the director should be or how the bureau will operate in any way from a policy standpoint? >> no, sir. that's not part of our responsibly under dodd-frank. >> another major issue that perhaps involves the treasury some and involves to some is the future of freddie mac and fannie mae. some concern that perhaps most, if not all of their functions would again be turned over to a new large financial enterprise. what is your general approach to the futur

>> congressman, the cfpb is located in the federal reserve on in a narrow sense that the federal reserve pays the bills. we have no oversight or control, the controller is coming coming from the treasury and i think they are the ones who would be most appropriate to respond to you about the nature of the bureau. >> you have no -- and the fed has no involvement in the operation of the bureau? you were just kind of the landlord and the paymaster? >> we're doing our best to help them get set up. there's a lot to be done in terms of just hiring people in setting up an i.t. system and so on, but in terms of policy making and so on, they are completely independent of the federal reserve. we have no say whatsoever. >> you were making no recommendations about who the director should be or how the bureau will operate in any way from a policy standpoint? >> no, sir. that's not part of our responsibly under dodd-frank. >> another major issue that perhaps involves the treasury some and involves to some is the future of freddie mac and fannie mae. some concern that perhaps most, if not all of their f

the federal reserve came here. unless we regulate the tses versus systemic risk and give regulators the ability, this would create a systemic financial crisis. i want to ask about those two points. >> i appreciate the questions. we did look at international capital and excess liquidity and monetary policy. in the book on page 83 there is a whole section on credit expansion and also parts in the book where we discuss other countries, housing bubbles, on that issue, the commission there was excess liquidity but in and of itself that need not have caused a crisis. could have been recognizing that excess liquidity. regulators, market purchase of this should have exercised discipline and in particular let me give you the example of the federal reserve. knowing there was that kind of excess liquidity in the global economy it was incumbent on the federal reserve to use its power to says reasonable funding. as someone out of the real-estate business we should have recognized those tighter mortgage lending standards and tha

morgan embarrass stearns the federal reserve decided hey you know what j.p. morgan take bear stearns will back whatever it is they did with money that will print and are still backing and the same thing in a different vein happened with goldman sachs and morgan stanley back in september of two thousand and eight which is these firms did not have. and enough capital to survive the weekend. and so on a sunday night they basically got to the fed and said you know what we need capital that might end up in the exact conversation but that's why banks go to the fed when they are in dire straits because they need capital but the problem was goldman sachs marcella were not classified as bank holding companies so technically this was a situation again where you push the law but then the law changes for you and in the case of the fed it didn't really have to change that much the fed just said ok fine we're going to waive our five day anti-trust check it out period which we obviously did with j.p. morgan and bear stearns we're going to just keep on doing whatever we can

inflation is expected to persist below the levels of the federal reserve policymakers have judged to be consistent over the longer-term. under such conditions the fed would typically ease monetary policy by reducing its target for the federal funds rate. however, the target range has been near zero 2008 cents, leaving no room for further reductions. -- the target range has been near zero since december 2008. the past two years the fed has eased monetary conditions by purchasing longer-term securities. these purchases have settled into the banking system with -- although large-scale purchases art a different monetary policy tool then the more familiar approach, eight two policies affect the economy in similar ways. this works by lowering market expectations for the future path of short-term interest rates, which reduces the current level of long-term interest rates. these changes bolster household and business spending and increase economic activity. by comparison, the purchases of longer-term securities does not affect short-term interest rates which remain close to zero, but put pres

bank because obama let's face it obama is just a sideshow the real power is ben bernanke in the federal reserve bank that's where the regime change needs to take place and ben bernanke is the figurehead for a collection of private banks and a few corporations like chevron who own the fed and they are the ones that are profiting from this economic war as paul the farrel talks about it if he lists ten reasons for weapons of this financial warfare that perpetrated by the fed and list two three of them commodity price inflation will soon and the fed dictatorship next near is zero rates means banks rich or massive poor meltdown and then finally easy money fueling worldwide inflation and a new meltdown so we've as you mentioned we've seen this in commodity price inflation all over the world well as you point out the federal reserve bank is owned by banks and corporations it's a private corporation it's not a function of the united states government anyway it's there as a lobbying group for corporations the number two you mentioned near zero percent interest rates this is really the killer because in

we had theoretically consumer protection as one of the objectives of the federal reserve and other federal regulators. we had in that same federal reserve the responsibility for safety and soundness of our financial institutions. those two things obviously were in conflict with each other because the federal reserve, instead of looking out for the interests of consumers and protecting consumers allowed consumers to get into mortgages and financial transactions that ended up in destroying our financial system. and they did it saying, well, you know, this is going to add to the safety and soundness of financial institutions because our definition of safety and soundness is a financial institution which can make more and more and more money. so what's the solution to that? you don't do away with safety and soundness. we didn't do away with safety and soundness. it's important to protect safety and soundness of our financial institutions. we continued to give that responsibility to the federal reserve and the regulators. but if you're going to protect consumers, you don't give the authority to

you price inflation all over the world well as you point out the federal reserve bank is owned by banks and corporations it's a private corporation it's not a function of the united states government in any way it's there as a lobbying group for corporations the number two you mentioned near zero percent interest rates this is really the killer because in the united states and around the world interest rates are not allowed to trade per the market they're kept artificially low to give free money to the speculators whenever they make a losing bet then the government bails them out and to pay for the government's bailout they put a gun to the people through austerity measures are saying and greece are saying in ireland they put a gun to the people several austerity measures to bail out the banks who were holding the government hostage so this is just easy money fueling worldwide inflation yes they're getting greedy they're forcing prices to go up to astronomical price levels i read a statistic somewhere on the number of people actually forced into poverty but that's a measure is really fa

we looked at the fdic, the federal reserve, the federal reserve bank of new york. let me speak to the nonpartisan nature of this. if you look at th report, we werecritical of their oversight of citigroup. we looked at hud, its affordable housing goals, we looked at the goal of the office of currency and the office of supervision. we looked at both financial institutions and regulators, and i think you will find tt we found without regard to party, without regard to private sector/public sector this crisis was avoidable, both in failures in regulation and failures in corporate risk management. >> thank you. the gentle lady from new york. >> mr. thomas, you wanted to respond? >> oh, 30 seconds. >> it's hard to get -- >> look, warren buffett came before us in new york and said he didn't think housing prices would go down the way they did. people who were supposed to be guru's in this said they weren't aware of it. you have to read a clever book by michael louis, if you haven't. he winds up writing a book about those three or four people who actually made money on it.

this is what you're seeing going on in the world right and this is caused from primarily the federal reserve bank is increasing the supply of cheap money the demand for the food is the problem is the supply of credit that's giving speculators an easy way to make greedy bucks in the short term even though it's putting forty four million people on the starvation lines so it mean think about the number of people who died in world war two people who died in previous wars this is of that comparable size the federal reserve is actually putting tens of millions of people into their into a grave well that's forty four million people yes that they're causing to start which is why paul the feral says that ben bernanke he is more dangerous than mubarak remember mubarak was a front man just for the military industrial complex ben bernanke he operates on behalf of the financial industrial complex. so there is going to need to be a regime change at some point as a matter of survival. you know people in america debate whether it's a left wing issue or a right wing issue it's none left or right it's a matte

well, the title of the book, the great relfation, was all about the federal reserve and other centralanks rescuing what looked like a death spiral in the economy and the financial sense. i mean, really it was very grim and scary for a while. so they threw everything at it-- all kinds of money, the federal reserve doubled its balance sheet, fiscal deficits like we've never seen before... - they pumped up general motors. i mean, they... aig... - and they bailed out the banks, and the did everything they could, and in fact i even heard it said that paulson, the secretary of the treasury, in a private conversation said, "we're going everything we can". this was when it was collapsing. "we're not even sure if it's legal or not. we're just doing it because we've got to stop the system from crashing". - they were scared too. - so now they've pumped all this money back in again, and they've got the stock market going, they've got commodity prices going. it looks like we're at the beginning of possibly another boom-bust cycle, so we've got the rollercoaster going again. but if you go back over

ben bernanke said today the federal reserve won't change its plans to fix the economy, because unemployment is still too high and inflation too low. but tom, many economists and investors are puzzled. should they be happy about prospects for a stronger economy or worried about signals of higher inflation? >> tom: susie, lawmakers on capitol hill had some strong opinions on this and grilled the fed chief when he testified. some pointed to signs of rising prices around the world and questioned bernanke about being too slow to combat inflation. as darren gersh reports, bernanke was doing his best to reassure lawmakers, and everyone else, that the fed has the economy under control. >> reporter: it was the first time federal reserve chairman ben bernanke has testified before a house committee since republicans took back control. and it was clear from the questioning by budget committee chairman paul ryan that the fed will be under much tougher scrutiny. from the top, ryan said he doubted the short-term boost from the fed's bond buying program, known as quantitative easing, will outweigh the long

[applause] the federal reserve creates money out of thin air.can loan to other governments and international financial institutions, and we are not allowed to know. they resent the fact that when i ask these questions they do not have to give the information. that is why a bill to audit the fed is the first step to ending the federal reserve. [applause] the federal reserve will distillate the dollar. -- will destroy the dollar. they had eliminated 98% of the value of the 1913 dollar. believe me, there is an economic law that says you just cannot continue to do this. congress has the responsibility. they need to protect the value of the currency. that means we have the moral and legal authority to put checks on the federal reserve system. [applause] there has been a lot of talk about bipartisanship after the election. "we need bipartisanship." in some ways that might be true. i tell you what i think about it. i think and i believe that we have had way too much bipartisanship for about 60 years. [applause] we have of bipartisanship on medical care

>>> federal reserve chairman ben bernanke said today that the u.s. economy should grow in a more rapid pace this year. also warned it will take several years before the unemployment rate falls to historical normal levels. speaking to an audience of reporters at the national press club in washington, d.c., mr. bernanke talked about the national debt and said the federal budget is on a, quote, unsustainable path. this is an hour. >> i cover business of the economics dues for the associated press and i president of the national press club. we are the world's leading professional organization for journalists and we are committed to the provisions future through our programming and by fostering a free press worldwide. for more information about the national press club please visit our web site at would back press.org, you can also find information about how to donate to our library. for all of our members worldwide, i would like to welcome our special speaker today and all of those attending the event include guest of the speakers as well as working journ

i mean, the federal reserve as the agent, the federal government makes many of these payments including interesting than other kinds of payments as well. we would have to find ways to make sure that we're making interest payments and not other kinds of payments. so i think it would be be some serious operational concerns. i'm -- particularly if this came with very short notice why do raise that point for your attention. beyond that, congress again has to make that determination whether you are willing to stop social security payment and the like as a temporary measure. >> i think if we make that one of our priorities because people have paid into that for years, making sure that the prodi, making sure our military is a priority, making sure interest as a priority, can't we then say to our, those who carry our debt that we will make sure that they're taking care of, and moving down the ladder and making sure our priorities are first and foremost at the top of the list so that let way we don't have to worry about -- it just seemed like coming to washington so far, issues a for conclusion

. >>> federal reserve chairman bene bernanke dismissed criticism that u.s. policy is a factor. >> i think it's entirely unfair to attribute excess demand pressures in emerging markets to u.s. monetary policy. >> on thursday, bernanke dispelled the idea that the fed's decision to supply more liquidity caused excess capital to flow into the commodities markets. he said emerging countries can use their own monetary policy or value their currencies to address inflation. he cited persistently high u.s. unemployment. he added u.s. consumer prices excluding food and energy are still at low levels. >>> two of japan's leading steel makers say they aim to join forces next year. >> translator: there are big changes in procuring materials, so the environment for the steel industry is changing drastically. >> translator: we must complete globally, because the steel industry will grow strong. >> nip pon steel and the country's third largest aim to combine their businesses by october 1st, 2012. they're making the move to become more competitive globally as strong demand is

the federal reserve has come at enormous distance. you may not be aware but in 1994 the fed didn't even announce when it changed the rate target and now of course we have an after meeting statement with folks of like the european central bank in almost any other bank we have detailed minutes that release the weeks after the meetings. we release full transcript of a five-year lag. we have extensive speeches and to some of these and other mechanisms, so we are a transparent central bank and we have made a lot of progress in that front. on press conferences, it has been a difficult decision as we thought about it. on the one hand, the real time transparency is very important and valuable piece of it all the other hand we don't want to create unnecessary uncertainty and volatility in the financial markets by saying things that may be misinterpreted if they are to ad hoc. that being said, as i said, i put a lot of vow to the entrance currency. we moved in the direction that we are looking very seriously at whether we have a committee in fa

improved quality that surveillance mechanisms a better use of the broad range of skills of the federal reserve staff. we have created a new office of financial stability within the federal research which will monitor financial developments across a range of markets and firms and oordinate with the council on the other agencies to strengthen oversight. the federal reserve is committed to its longstanding practice of insuring all of its rulemakings are conducted in a fair, open and transparent manner. accordingly we are disclosing our public website of all communications with members of the public including banks, trade associations, consumer groups and academics regarding matters subject to a proposed future rulemakings under the act. we also implemented measures within the act to enhance the deral reserve transparency. in december we released detailed information regarding individual transactions conducted between december 1st, 2007 and july 20, 2010 across a wide range of the federal reserve liquidity programs and we are developing the necessary processing is to disclose the information conce

improved quality that surveillance mechanisms and better use of the broad range of skills of the federal reserve staff. we have created a new office of financial stability within the federal research which will monitor financial developments across a range of markets and firms and coordinate with the council on the other agencies to strengthen oversight. the federal reserve is committed to its longstanding practice of insuring all of its rulemakings are conducted in a fair, open and transparent manner. cordingly we are disclosing our public website of all communications with members of e public including banks, trade asociations, consumer groups and aademics regarding matters subject to a proposed future rulemakings under the act. we also implemented measures within the act to enhance the fedel reserve transparency. in december we released detailed information regding individual transactions conducted between december 1st, 2007 and july 20, 2010 across a wide range of the federal reserve liquidity programs and we are developing the necessary processing is to disclose the information concerning t

market pros say investors need to watch global inflation pressures and the end of the federal reserve's easy money policy. strategist mike ryan also says be on guard for a deepening of middle east tensions. >> if we see the current unrest that had started in tunisia and cairo and now seems to be manifesting itself in place like bahrain and libya. if that becomes even broader in the region and destabilizes some of the u.s. key allies and threatens supply of energy that would be a bigger concern for the market as well. >> reporter: many market pros say a near-term market correction wouldn't shock them. but, most also believe the path of least resistance for stocks is higher. if that were only true for february temperatures here in manhattan? suzanne pratt, "nightly business report," new york. = >> susie: the stock buying momentum continued today on wall street. and it was another winning week for the major averages. let's take a look in tonight's market focus. as we wrap up this friday, the blue chips marked their third straight weekly rise. it's also their eleventh weekly increase in the

improved quality that surveillance mechanisms and better use of the broad range of skills of the federal reserve staff. we have created a new office of financial stability within the federal research which will monitor financial developments across a range of markets and firms and coordinate with the council on the other agencies to strengthen oversight. the federal reserve is committed to its longstanding practice of insuring all of its rulemakings are conducted in a fair, open and transparent manner. accordingly we are disclosing our public website of all communications with members of the public including banks, trade associations, consumer groups and academics regarding matters subject to a proposed future rulemakings under the act. we also implemented measures within the act to enhance the federal reserve transparency. in december we released detailed information regarding individual transactions conducted between december 1st, 2007 and july 20, 2010 across a wide range of the federal reserve liquidity programs and we are developing the necessary processing is to disclose the information co

the federal reserve chairman discusses the economic outlook at the national press club. standard & poor's cut ireland's credit rating by one notch to "a minus" today. that's four levels above non- investment grade. it gives ireland the same rating as portugal, turkey and cyprus. s&p says a further downgrade is possible as the irish government struggles to contain bank bailout costs. the downgrade comes as ireland prepares for elections in which the cost of bailing out banks is a major issue. >> tom: h.p. will give a refund

[applause] the federal reserve creates money out of thin air.can loan to other governments and international financial institutions, and we are not allowed to know. they resent the fact that when i ask these questions they do not have toive the information. that is why a bill to audit the fed is the first step to ending the federal reserve. [applause] the federal reserve will distillate the dollar. -- will destroy the dollar. they hadliminated 98% of the value of the 1913 dollar. believe me, there is an economic law that says you just cannot continue to do this. congress has the responsibility. they need to protect the value of the currency. that means we have the moral and legal authority to put checks on the federal reserve system. [applause] there has been a lot of talk about bipartisanship after the election. "we need bipartisanship." in some ways that might be true. i tell you what i think about it. i think and i believe that we have had way too much bipartisanship for about 60 years. [alause] we have of bipartisanship on medical care. the

was really the spark not the cause but those prices were rising in the first place because of federal reserve policy i mean it's the united states that's primarily flooding the world with cheap money. and that in order to bail us out of our own recession or i agree with the first has that we're not really seeing a real recovery in the united states but we are seeing a recovery based on the metrics that the federal reserve uses they see low inflation because they don't really count food and energy and they see a lot of spending which they considered economic growth now these higher oil prices and i do a greedy that the price as i say sustainable now north of one hundred twenty dollars a barrel that'll take a sizeable chunk out of u.s. g.d.p. growth that'll slow the economy down but it's not going to raise inflation as the fed sees it as they don't count energy as inflation so that will cause them to reliquefy the markets even more to try to keep us out of a recession and that will again ignite food inflation around the world and add more fuel to this fire william i don't think you and andrew a