# Ben Bernanke **Ben Bernanke** was Chair of the [[Federal Reserve]] from **February 1, 2006 to January 31, 2014**, appointed by [[George W. Bush]] and reappointed by [[Barack Obama]]. He led the central bank through the [[2008 Financial Crisis]] and invented much of the toolkit every central bank now uses. To the hard-money right he is the face of everything wrong with modern money. ## The Depression scholar Born in 1953 and raised in Dillon, South Carolina, Bernanke studied at Harvard and earned his Ph.D. at MIT. At Princeton he chaired the economics department. His 1983 paper on the Great Depression argued that bank failures deepened the slump by destroying the credit relationships that businesses depended on, independent of their effect on the money supply. That paper is the core of the work for which he shared the **2022 Nobel Prize** in economics with Douglas Diamond and Philip Dybvig. He joined the Fed's Board of Governors in 2002. That year a speech on preventing deflation, which borrowed [[Milton Friedman]]'s image of dropping money from helicopters, earned him the nickname "Helicopter Ben." He chaired Bush's Council of Economic Advisers in 2005–2006 before succeeding [[Alan Greenspan]]. ## The crisis record | Date | Action | |---|---| | Mar 2008 | Fed lends to engineer JPMorgan's rescue of [[Bear Stearns]] | | Sep 2008 | [[Lehman Brothers]] allowed to fail; the Fed rescues [[AIG]] days later | | Dec 2008 | Policy rate cut to a 0–0.25% range, the start of [[ZIRP]] | | Nov 2008 – 2014 | Three rounds of [[Quantitative Easing]] (QE1 Nov 2008, QE2 Nov 2010, QE3 Sep 2012); the balance sheet grows from under $1 trillion to about $4.5 trillion | | May 2013 | Hints that purchases will slow; bond yields jump in the "taper tantrum" | He also made the Fed talk: regular press conferences, an explicit 2% inflation target (2012), and [[Forward Guidance]] as a policy tool. *Time* named him Person of the Year for 2009. ## The legacy fight For this vault, Bernanke is the figure at the center of the **hard-money right's critique** of the post-2008 order. QE and near-zero rates are what the [[Austrian School]], [[Sound Money]] advocates, [[Ron Paul]]'s Audit the Fed movement and the bitcoin movement attack as currency debasement and a subsidy to people who own assets. The populist left makes a version of the same complaint about Wall Street being rescued while homeowners were not. His defenders answer that without these tools 2008 would have become a second Great Depression, the very outcome his scholarship was about. Since leaving the Fed he has been at the [[Brookings Institution]]. In 2024 he led a review of the Bank of England's forecasting, and in 2023 he co-wrote with Olivier Blanchard the leading study of what caused the pandemic-era inflation (see [[Supply Shock]]). ## See Also - [[Federal Reserve]] · [[Monetary Policy]] · [[2008 Financial Crisis]] · [[Financial System Hub]] - [[Quantitative Easing]] · [[ZIRP]] · [[Forward Guidance]] · [[Ample Reserves]] - [[Alan Greenspan]] · [[Janet Yellen]] · [[Henry Paulson]] · [[Interest Rate Policy Timeline]]