Not just more honest, more concise too!
Did Bernanke mean supervision or bailout?
Courtesy of Tim Iacono at The Mess That Greenspan Made
Perhaps there is some context, somewhere, that makes yesterday’s words from Fed chief Ben Bernanke’s prepared remarks before the House Financial Services committee on the subject of the Fed’s role in bank supervision seem less filled with hubris than they first appear. But, if there is, I couldn’t find them.
The Federal Reserve is uniquely suited to supervise large, complex financial organizations and to address both safety and soundness risks and risks to the stability of the financial system as a whole.
…
The insights provided by our role in supervising a range of banks, including community banks, significantly increases our effectiveness in making monetary policy and fostering financial stability.
Maybe he’s confusing risk assessment and fostering stability with bailing out the big banks, something that the Fed chief has proven himself quite proficient at over the last few years.
If a few substitutions are made (in bold), this seems to make a whole lot more sense.
The Federal Reserve is uniquely suited to
supervisebailout large, complex financial organizations and to addressboth safety and soundness risks and risks to the stability of the financial system as a wholefuture bailouts.
…
The insights provided by ourrole in supervisingbailing out a range of banks, not including community banks, significantly increases our effectiveness in making monetary policy andfostering financial stabilityguaranteeing that there will be more bailouts.
Yes, that’s much better.
