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Fed Chairman Ben Bernanke highlighted ongoing efforts to monitor threats and vulnerabilities in four critical areas: systemically important financial institutions, shadow banking, asset markets, and the nonfinancial sector.
May 10 -
Fed Chairman Ben Bernanke rejected claims by big banks Monday that they should be able to see the equations the central bank uses when it calculates their stress test scores.
April 8
WASHINGTON Central bankers are used to having their every word parsed for signs of economic insight. But it probably helps if they recall making the comment in the first place.
Thanks to Washington Post columnist Neil Irwin, we now may know once and for all whether Federal Reserve Board Chairman Ben Bernanke ever used ketchup as a metaphor to articulate a point about inflation.
Irwin recounted on the paper's "Wonkblog" how chattering masses in Japan were convinced Bernanke during a 2003 trip to the country as a Fed governor had
"The story that has circulated for years among Bank of Japan officials and repeated in a book by economist Richard Koo is this: In Bernanke's May 2003 visit, he made the point that a central bank should always be able to create higher inflation," wrote Irwin, who also discussed the mysterious incident in his book "The Alchemists: Three Central Bankers and a World on Fire." "If buying financial assets to pump money into the economy wasn't enough, it could just buy anything-even tomato ketchup-and accomplish the same result of increasing the supply of money in the economy and the price level."
As Irwin pointed out, "Bernanke doesn't remember saying it and is quite doubtful that he did."
Through some further reporting, the journalist now argues that Bernanke may have been confused with John Taylor, a former Treasury undersecretary who now teaches at Stanford. Irwin wrote that although Taylor does not recall making the ketchup remark during his 2002 trip to Japan, the economist has been known to use the metaphor in classes, and his former Treasury aide on the trip, Tony Fratto, does remember Taylor making the comment.
"It seems quite likely that this is what happened: Taylor made the amusing ketchup comment. In the retelling, it was attributed to the other highly regarded American macroeconomist-turned-U.S. government official who visited at around the same time," Irwin wrote.
It would not be the first time Bernanke has been mistaken for someone else. In a
"I've got the wrong person? "Who were you the CEO of?" she said. To which Bernanke responded, "I was the CEO of the Princeton economics department."
