Ben Bernanke Quotations | Page 2

There's no denying that a collapse in stock prices today would pose serious macroeconomic challenges for the United States. Consumer spending would slow, and the U.S. economy would become less of a magnet for foreign investors. Economic growth, which in any case has recently been at unsustainable levels, would decline somewhat. History proves, however, that a smart central bank can protect the economy and the financial sector from the nastier side effects of a stock market collapse.

Education - lifelong education for everyone - from toddlers to workers well advanced in their careers - is indeed an excellent investment for individuals and society as a whole.

Monetary policy is not a panacea.

Not all information is beneficial.

In fact, the world needs more nerds.

Life is amazingly unpredictable; any 22-year-old who thinks they know where they will be in 10 years, much less in 30, is simply lacking imagination.

I am confident that we will meet whatever challenges the future may bring.

The impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.

Among the largest banks, the capital ratios remain good and I don’t expect any serious problems . . . . among the large, internationally active banks that make up a very substantial part of our banking system.

We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.

A money-financed tax cut is essentially equivalent to Milton Friedman's famous 'helicopter drop' of money.

While rising delinquencies and foreclosures will continue to weigh heavily on the housing market this year, it will not cripple the U.S.

One might as well try to perform brain surgery with a sledgehammer.

I don't fully understand movements in the gold price

Although low inflation is generally good, inflation that is too low can pose risks to the economy - especially when the economy is struggling.

The basic prescription for preventing deflation is straightforward, at least in principle: Use monetary and fiscal policy as needed to support aggregate spending, in a manner as nearly consistent as possible with full utilization of economic resources and low and stable inflation. In other words, the best way to get out of trouble is not to get into it in the first place.

House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals.

I don't think that Chinese ownership of U.S. assets is so large as to put our country at risk economically.

If current trends continue, the typical U.S. worker will be considerably more productive several decades from now. Thus, one might argue that letting future generations bear the burden of population aging is appropriate, as they will likely be richer than we are even taking that burden into account.

The Federal Reserve is not currently forecasting a recession.

The GSEs are adequately capitalized. They are in no danger of failing.

The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.

The financial crisis appears to be mostly behind us, and the economy seems to have stabilized and is expanding again.

I don't see much evidence of an equity bubble,

The people who best use their advantages, or overcome adversity, and work honestly are those most worthy of admiration.

The best approach here if at all possible is to use supervisory and regulatory methods to restrain undue risk-taking and to make sure the system is resilient in case an asset price bubble bursts in the future.

The risk exists that, with aggregate demand exhibiting considerable momentum, output could overshoot its sustainable path, leading ultimately in the absence of countervailing monetary policy action to further upward pressure on inflation.

The more important reason is that the research itself provides an important long-run perspective on the issues that we face on a day-to-day basis.

To avoid large and unsustainable budget deficits, the nation will ultimately have to choose among higher taxes, modifications to entitlement programs such as Social Security and Medicare, less spending on everything else from education to defense, or some combination of the above.

Under a cold turkey strategy, at each policy meeting the Federal Open Market Committee would make its best guess about where it ultimately wants the funds rate to be and would move to that rate in a single step.

...the Federal Reserve has the capacity to operate in domestic money markets to maintain interest rates at a level consistent with our economic goals

September and October of 2008 was the worst financial crisis in global history, including the Great Depression,

I think that having good data, good statistics-and the United States generally has better macroeconomic statistics than most countries-and having good economists to interpret those data and present the policy alternatives, has a substantially beneficial effect on policymaking in the United States.

[Virtual Currencies] may hold long-term promise, particularly if the innovations Promote a faster, more secure and more efficient payment system.

A meritocracy is a system in which the people who are the luckiest in their health and genetic endowment; luckiest in terms of family support, encouragement and, probably, income; luckiest in their educational and career opportunities; and luckiest in so many other ways difficult to enumerate - these are the folks who reap the largest rewards.

I'd throw dollars out of helicopters if I had to, to stimulate the economy.

Under current law, on January 1st, 2013, there is going to be a massive fiscal cliff of large spending cuts and tax increases.

Both humanity's capacity to innovate and the incentives to innovate are greater today than at any other time in history.

The crisis in Europe has affected the U.S. economy by acting as a drag on our exports, weighing on business and consumer confidence, and pressuring U.S. financial markets and institutions.

If Wall Street crashes, does Main Street follow? Not necessarily.

If you are asking me if I would advocate that the Chinese go to greater flexibility in their exchange rate, I certainly would.

We’ve never had a decline in house prices on a nationwide basis. So, what I think what is more likely is that house prices will slow, maybe stabilize, might slow consumption spending a bit. I don’t think it’s going to drive the economy too far from its full employment path, though.

I am very proud of my nerd-dom.

Speaking as somebody who has been happily married for 35 years, I can't imagine any choice more consequential for a lifelong journey than the choice of a traveling companion.

The benefit of appointing a hawkish central banker is the increased inflation-fighting credibility that such an appointment brings.

The Fed is totally open.

I generally leave the details of fiscal programs to the Administration and Congress. That's really their area of authority and responsibility, and I don't think it's appropriate for me to second guess.

It is not the responsibility of the Federal Bank - nor would it be appropriate - to protect lenders and investors from the consequences of their decisions

Over the years, the U.S. economy has shown a remarkable ability to absorb shocks of all kinds, to recover, and to continue to grow. Flexible and efficient markets for labor and capital, an entrepreneurial tradition, and a general willingness to tolerate and even embrace technological and economic change all contribute to this resiliency.

The economic repercussions of a stock market crash depend less on the severity of the crash itself than on the response of economic policymakers, particularly central bankers.

The sources of deflation are not a mystery. Deflation is in almost all cases a side effect of a collapse of aggregate demand.. a drop in spending so severe that producers must cut prices on an ongoing basis in order to find buyers.

Nobody really understands gold prices and I don't pretend to understand them either,

Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services.

The Federal Reserve will not monetize the debt.

If your uniform isn't dirty, you haven't been in the game.

Economics is a very difficult subject. I've compared it to trying to learn how to repair a car when the engine is running.

With respect to their safety, derivatives, for the most part, are traded among very sophisticated financial institutions and individuals who have considerable incentive to understand them and to use them properly.

Economics is a highly sophisticated field of thought that is superb at explaining to policymakers precisely why the choices they made in the past were wrong. About the future, not so much.

The U.S. government has a technology, called a printing press (or today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at no cost.

Nobody likes to fail but failure is an essential part of life and of learning. If your uniform isn't dirty, you haven't been in the game.

There are some petroleum refineries that don't have crude and by allowing them to draw from the Strategic Petroleum Reserve they will be able to produce more gasoline.

There are various estimates about the third quarter impact. Our CEA (Council of Economic Advisers) numbers are somewhere between a half and one percentage point on growth. That would still probably leave us at a decent rate of growth for the third quarter.

There are various estimates about the third quarter impact, ... Our CEA (Council of Economic Advisers) numbers are somewhere between a half and one percentage point on growth. That would still probably leave us at a decent rate of growth for the third quarter.

There are two possible mistakes: One is to go on too long, and one is not to go on long enough. And, it's a very difficult balancing act.

Low marginal tax rates are supportive of economic growth. I would submit that we would want to look very hard at government spending - make sure it's controlled - before we raise taxes, which, in turn, would have negative impacts on the economy.

Many savers are also homeowners; indeed, a family's home may be its most important financial asset. Many savers are working, or would like to be.

Sector-specific price declines, uncomfortable as they may be for producers in that sector, are generally not a problem for the economy as a whole and do not constitute deflation.

So far, the effects appear to be relatively modest on growth.

So far, the actual actions taken have been relatively modest, but there is some hope, I think, that, going forward, these actions will advance further and we will see more progress in the current account.

Since World War II, inflation - the apparently inexorable rise in the prices of goods and services - has been the bane of central bankers.

My first priority will be to maintain continuing with the policy and policy strategies under the Greenspan era.

One may aspire to succeed Chairman Greenspan but it will not be possible to replace him,

Of course, a decision to take no action at a particular meeting does not preclude action at subsequent meetings.

One would be forgiven for concluding that the assumed benefits of financial innovation are not all they were cracked up to be.

Only a strong economy can create higher asset values and sustainably good returns for savers.

Monetary policy is most effective when it is coherent, consistent and predictable as possible, while at all times leaving full scope for flexibility and the use of judgment as conditions may require.

Monetary policy is a blunt tool which certainly affects the distribution of income and wealth, although whether the net effect is to increase or reduce inequality is not clear.

Monetary policy has less room to maneuver when interest rates are close to zero, while expansionary fiscal policy is likely both more effective and less costly in terms of increased debt burden when interest rates are pinned at low levels.

No one will lend at a negative interest rate; potential creditors will simply choose to hold cash, which pays zero nominal interest.

Now that I'm a civilian again, I can once more comment on economic and financial issues without my words being put under the microscope by Fed watchers.

Neighborhoods and communities are complex organisms that will be resilient only if they are healthy along a number of interrelated dimensions, much as a human body cannot be healthy without adequate air, water, rest, and food.

Obviously, I haven't succeeded in defusing the political concerns about the Fed.

I do not subscribe to any rigid and mechanical rule ... I intend to be flexible and to learn from experience.

I am going to begin now a practice of not making recommendations on specific tax and spending proposals.

I believe that the Federal Reserve's success in reducing and stabilizing inflation and inflation expectations is a major reason for this improved economic performance.

But again, I remain optimistic that the impact on energy from these two events will be limited.

I have spoken about deficits, and I think deficits are important because they address broad economic and financial stability. We need to talk about that.

Growth in U.S. real imports slowed to about 3 percent in 2006, in part reflecting a drop in real terms in imports of crude oil and petroleum products.

Given the extent of the exposures of major banks around the world to A.I.G., and in light of the extreme fragility of the system, there was a significant risk that A.I.G.'s failure could have sparked a global banking panic.

If bankers become overly conservative in response to past lending mistakes - or if examiners force such behavior - it will hurt bankers' own long-term interests and the economy in general.

If Australia finds it has a strong Australian dollar, and it has higher unemployment, then it would have to respond, and that would either be by increasing domestic demand or by weakening its own currency.

There is enormous demand for dollar denominated assets so I don't expect that this demand would drop precipitously.

Under constrained discretion, the central bank is free to do its best to stabilize output and employment in the face of short-run disturbances, with the appropriate caution born of our imperfect knowledge of the economy and of the effects of policy (this is the 'discretion' part of constrained discretion),

Under Chairman Greenspan, monetary policy has become increasingly transparent to the public and the financial markets, a trend that I strongly support.

We must ensure that the funds we commit are spent wisely and with careful oversight.

He lived with us for 24 years, ... He studied with us.

has set the standard for excellence in economic policy-making.

I think it's generally a bad idea for the Fed to be the arbiter of asset prices. The Fed doesn't really have any better information than other people in the market about what the correct value of asset prices is.

I think at this point in time that the inverted yield curve is not signaling a slowdown.

I will make continuity with the policies and policy strategies of the Greenspan Fed a top priority,