On January 31, Ben S. Bernanke stepped down as the US Federal Reserve chairman, ending eight tumultuous years in office. As of February, Janet Yellen is the new Fed chairwoman.
Given how different the legacy of Bernanke’s predecessor, Alan Greenspan, turned out a few years later after Greenspan stepped down, many commentators are understandably reluctant about remarking on Bernanke’s legacy so soon, preferring instead to wait it out for a few years before passing judgement.
Nevertheless, there are several media reports discussing the possible legacy of Bernanke. Here are my top 10 quote picks from them:
“After a financial crisis he didn’t see coming, Ben Bernanke steered the U.S. away from a potentially devastating panic. Yet five years later, the recovery he helped engineer with extraordinary policies remains frustratingly weak.
“That legacy — a mix of failings, boldness, persistence and frustration — is coming into sharper focus, and with it a clearer picture of the power and limitations of modern central banking. ”
— Jon Hilsenrath, reporter with The Wall Street Journal
“Mr. Bernanke has succeeded in changing an institution once so committed to secrecy that a 1985 book dubbed it “an intentional mystery.”
“Twenty years ago, the Fed didn’t even disclose when its policy committee had decided to move interest rates, let alone explain why. [In December], the central bank issued a 694-word statement as well as economic forecasts stretching to 2016.”
— David Wessel, author and contributor to The Wall Street Journal
“Some skeptics would argue that the Fed’s monetary activism has merely been setting the stage for an even bigger blowup.
So far, though, the record favors Gentle Ben. Global capitalism didn’t end up imploding on his watch; since 2009, the U.S. economy has outperformed most other advanced economies; stock markets around the world have been on a tear; and other countries, such as the United Kingdom and Japan, have copied the policies he pioneered, principally the one known as “quantitative easing.”
“… we all owe him a debt of gratitude. He may not be the greatest Fed chairman in recent history….But Bernanke will also go down in the history books as an important figure. If he hadn’t demonstrated the flexibility and open-mindedness he did, things could have been much, much worse.”
— John Cassidy in The New Yorker
“Mr Bernanke had sought to depersonalize the Fed by investing more of its authority in the collective wisdom of the Federal Open Market Committee rather than its chairman.
“Mr Bernanke’s openness to Rooseveltian experimentation made him willing to appropriate others’ good ideas as his own, as he eventually did with proposals first made by Charlie Evans, the Chicago Fed president, to tie interest rates to unemployment thresholds, and Janet Yellen, the vice-chair and incoming chair, to more expressly tolerate inflation overshoots.
— GI in The Economist
“The outgoing chairman of the US Federal Reserve unquestionably saved the world economy after the Lehman crisis in 2008, but only after having caused the great debacle in the first place.
“The Bernanke Fed has put jobs above the protection of narrow creditor interests. Its twin mandate of jobs and inflation has proved its value. America’s democracy and ruling institutions have weathered another fearsome challenge.”
— Ambrose Evans-Pritchard in The Telegraph
“Ben Bernanke’s appointment to the Fed arguably speaks to George W. Bush’s worst mistake among many made while in office.
“Readers should rejoice his departure, and thank goodness that the adolescent approach to economics which Bernanke preaches will no longer hold sway in what is a superfluous Federal Reserve, albeit one possessing the power to foist great damage on the economy as Bernanke’s years at the helm reveal in frightfully vivid color.”
— John Tammy in Forbes
“I give him for his whole tenure an A-minus.”
— Economist and Princeton professor Alan Blinder in a PBS interview
“The Fed under Bernanke in the last two years has created inflationary risk that could be hard for his successors to manage.
“What he created was a risk of inflation over the next five years, in exchange for getting very small potatoes in terms of improvement in the economy over the past two years.”
— Charles Calomiris, professor at Columbia Business School, in a PBS interview
“The Bernanke years could lead inexorably to another crash.”
— Philip Inman in The Guardian
“I think Bernanke’s legacy will be a very positive one. He will be known for doing whatever it took to get us out of the financial crisis.”
— Boston Federal Reserve Bank President Eric Rosengren in a Reuters interview