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Bernanke legacy: Final chapter yet to be written

January 30, 2014 • National News


FILE – In this Thursday, Jan. 16, 2014, file photo, put going Federal Reserve Chairman Ben Bernanke speaks about the Federal Reserve’s first and next century, at the Brookings Institution in Washington. When Ben Bernanke puts on his coat and leaves his office Friday, he will close the door on a precedent-breaking eight years as chairman of the Federal Reserve. (AP Photo/Manuel Balce Ceneta, File)

WASHINGTON (AP) — When Ben Bernanke puts on his coat and leaves his office Friday, he will close the door on a precedent-breaking eight years as chairman of the Federal Reserve.

What’s next?

Bernanke has said he plans to stay in Washington to write books and give speeches. Liberated from the constraints of the Fed, he’ll have more time for his favorite pastime, reading.

He’ll even get to drive a car for the first time in eight years.

Bernanke took office on Feb. 1, 2006, more the shy Princeton professor than a likely combatant in Washington’s knock-down political culture, though he’d served on the Fed’s board and for eight months as head of President George W. Bush’s Council of Economic Advisers.

On his watch, the U.S. economy and financial system fell into their gravest crisis since the Great Depression. Suddenly, a quiet academic who had spent years studying the Fed’s mistakes in the 1930s faced pressure himself to help save the economy from free-fall.

As a student of the Depression, Bernanke felt policymakers then had been too hesitant to deploy the Fed’s powers. Under his leadership, the Fed invoked all its conventional tools. Once those were exhausted, Bernanke turned to extraordinary steps never before tried by the Fed.

Besides cutting a key short-term interest rate to a record low near zero, Bernanke launched a bond buying program that drove the Fed’s balance sheet above $4 trillion to try to accelerate growth and shrink Login to read more

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