Benjamin Bernanke's Federal Reserve: 2005 - 2013.

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Benjamin Bernanke, at the time he inherited the job as Chairman of the U.S. Federal Reserve had more challenges ahead of him that any Fed. Chief in recent memory.  His predecessor, Mr. Alan Greenspan, arrived at his Fed. Reserve Chairman appointment with a stellar resume from business and industry and had followed an empirical path through the economics and banking world to his job at the U.S. Federal Reserve starting on or about 1987 and ending in 2005 (eighteen years.)  Bernanke was a change from Greenspan as a tough act to follow, and as the new Fed. Chairman confirmed in 2005 had a career in academia that dealt with the same level of statistical detail and analysis as his predecessor, though the emphasis of the Bernanke Federal Reserve was necessarily anti – inflation targets, troubled assets, interest rate targets, Quantitative Easing, and easing monetary policy among other things that have been his calling for the past seven or eight years.  The Federal Reserve has many schools of capitalist economics just in the air and around its various personalities and public figures, of which a Keynsian framework that has had overall a great influence on economic modernism and to which Ben Bernanke has made substantive and substantial contributions including that of easy money and a methodological approach to and adaptive use and interpretation of economic information and statistics.  This has been primarily due to Bernanke’s Chairmanship at the Fed calling for and integrating the features of faster rates of market economics change into its models and processes in view of simulating the overall surrounding economy as an modern and rapidly changing entirety.

Ben Bernanke who is apparently being replaced by Janet Yellen (who is herself apparently an inflation and quantitative hawk more in parallel with Greenspan than his successor Bernanke,) conducted a simultaneous “war on inflation”, overall efforts at price stability and crisis management given the effects of the internet bust and the housing constructions and mortgages bust during the 2000’s and more.  He has been a consensus Fed. Reserve Chairman using pragmatic business tools, “gut instincts,” the usual computerized and arcane modeling in addition to the traditional economics models, encouraging different voices and opinions among the members of the Board of the Federal Reserve, and as a major emphasis of his tenure – better and more communication and transparency with respect to public availability of details, press, and information about the Fed from the beginning of his appointment in 2005.  While following the policy path set in place by the current democratic administration in Washington, D.C. during 2005 – 2013, the Fed. Chairman was well versed enough in economics and business to know capitalism suffers more in its reputation from boom and bust cycles, that cannot really be controlled by central banks and other factors that call the Fed. to act in supporting business and commerce from the point of view of Washington, D.C., Wall Street and Main Street.  Recently, this institutional conduct has continued with the adverse remembrances of the 1930’s Great Depression, the “lost years” – 1990’s – in Japan as a policy backdrop, and the related climate of the credit markets during both recent downturns and their effects that were so negative and uninviting to commerce, business and industry.  Despite some of the work Bernanke’s Fed. carried out to cure some of the nation’s economic ills due to systemic weakness and delayed recovery, the typical self – regulating features of our economy, and the Chairman’s control over rates as well and probably due at least in part to the public trust and government insistence, Bernanke was not fully vested in his work as Fed. Chairmnan at first due to public criticism (even from Greenspan) and for some what was the integrations of labour economics and statistics and the further integration of bright – line employment and inflation targets.  During the crises of his Fed. Reserve term, the Fed.'s Mandate of Employment and Inflation itself was almost as important as the general integrity of the financial system as centered in New York City.  Whenever a decision was made during the Bernanke years, New York remained of important consideration, but places Like London, Berlin and Saint Petersburg and their economic considerations were looked at too in view of husbanding the U.S. public and private finances in the correct way and with the highest integrity.  Bernanke believed in adjustments versus taking an overall (sometimes leviathan) problem – solving approach.  

For the Federal Reserve at present, computing power has been developed and related real statistics and their processes of “synthesis” and interpretation that lead to internal reporting and policy decisions and implementation since the 1960’s and the technology the Fed has is part and parcel of high – tech development on the institutional level, centrally and regionally among the country’s twelve reserve banks scattered around the U.S.  Bernanke followed a school of economic thought that includes strict governance with goals of growth and anti – inflation levels of unemployment.  This type of economics is characterized by the results of economic stimuli with adjustments that are frequently called for to keep the U.S. economy growing if not functioning smoothly.  This modern Keynsian – style oversight also integrates the proviso that deliberate stimulation of the economy and its frequently called – for adjustments can cause and result in as many problems and difficulties it promises to cure.  A book about the Bernanke Fed. by Ethan Harris illustrates the “synthesis” approach after 2004 that prevailed to promote flexibility, draw on an eclectic series of economic theories and a consensus approach to internal discussions and decisions on monetary policy.  This is a measure of the classical approach to economics in which, i.e., unemployment identities in the social sciences provide a set of “traffic laws” that show the potential and changes in demographics, for example.  There are numerous such identities in the economics of labor and many have been used, the related analysis tools have names like NAIRU and Phillips Curve, all of which when used properly and when producing proper effects add to individual and business incomes, again as a rule.  The book gives and illustrates a considerable discussion between Keynsian and Classical influences in economic doctrine and policy at the Fed. and that Bernanke came from academia into his job where mostly crises and the Classical view (as working theory and its ramifications) provided most grist for the mill for the FOMC and Chairman and Federal Reserve Board in addition to the regional governors around the country.  The text (Harris, 2007)  delves into great detail as to theoretical examination of both the Greenspan and Bernanke Fed regimes alike.  Both are considered successful for various reasons, but Greenspan primarily for traversing some fifteen different crises and keeping the economy in the U.S. on a path of steady growth.  Bernanke is credited with maintaining liquidity in the “Great Recession” with inflation targets, his policy use of labor economics, and his judicious and wise handling of various lending facilities during his eight – year tenure in holding inflation and prices stable and steady in time of chaos, even panic, and alarm in the markets in economic terms.  The Harris text emphasizes the “new” rules of the macroeconomic game and Bernanke’s survivability and adaptability in making several key decisions about policy that enabled the U.S. economy to traverse the crises of 2007 – 08 and more.  One also obtains from a good reading of the book a good notion of ordinary Federal Open Market Committee workings, especially the key indicators it might be using and about the meaning of its various communications with investors, the public, officials and other parties and stakeholders.