Posted on 05/12/2011 10:44:27 AM PDT by quesney
Federal Reserve chief Ben Bernanke reinforced his call on Thursday for Congress to raise the cap on U.S. borrowing, saying a failure to do so could lead down the same risky path that the failure of Lehman Brothers did.
During a Senate Banking Committeee hearing, Bernanke reiterated catastrophic consequences should Congress either fail to raise the limit on borrowing or edge too close to that limit.
"The worst outcome would be one in which the financial system would be again destabilized, which we saw in Lehman, which would have extremely dire consequences for the rest of the economy," Bernanke said, referring to the period following the failure of the Wall Street bank Lehman Brothers at the height of the financial crisis in 2008.
Bernanke also said that "using the debt limit as a bargaining chip is quite risky," reiterating a worry he expressed in a February press conference.
(Excerpt) Read more at finance.yahoo.com ...
Would you quit asking logical questions?
Sounds like a veiled threat to me.
Fire Bernanke now!!
Americans: Fire Bernanke now.
Ben
Shut off and go home
Bernake was dead wrong before, during and after the financial debt implosion. We are in the same condition as Iceland and Greece, Iceland did the right thing and Greece the wrong thing which is recovering?
Isn’t “raising the debt ceiling” like me requesting an increase in the limit on my credit cards just so I can live at a rate higher than I can really afford?
What a schmuck.
Bernanke’s easy money policy has done as much to wreck the US economy as Obama’s crazed spending.
And he wants to see MORE debt?
The problem is your average American has no clue how the Federal Reserve works nor do they care. They have more interest in American Idol and Survivor.
FUBB!!
Ya know, he’s probably right. We’re pretty much at the point of collapse, and just betting on which straw is the final one.
Yes, spending must be cut - drastically, immediately. Ain’t gonna happen, at least nowhere near the levels needed (over $5000 per citizen). Remember the “We promise to cut $100B...ok, we’ll settle for $80B...we got $60B...sorry, we mean $0.3B...” nonsense? you think after that “success” they’re gonna cut $1600B for real? Not. Ergo, crash.
Only immediate option then is, indeed, to raise the debt limit. Yeah, that means there isn’t one; we know that. Pile it higher and deeper, and we know where that will get us.
So in a sense he’s right. He can’t put off a crash without permission to indulge in more debt. That’s not preventing the crash, mind you, just putting it off.
Get your 40 acres and a mule. You’re gonna need ‘em.
Ben Bernanke defends bank bailout
Federal Reserve Chairman Ben Bernanke defended the Fed’s handling of the financial crisis in 2008 before a federal commission Thursday, saying the bailout averted a much greater crisis for the U.S. economy.
Speaking before the Financial Crisis Inquiry Commission, Bernanke also explained the Fed’s involvement in the collapse of Lehman Brothers in September 2008, saying the federal government did everything it could to avoid the company’s death.
He repeated earlier statements that the Fed did everything within its legal authority to avoid the company’s death.
“The only way we could have saved Lehman would have been by breaking the law,” he said. “And I’m not sure I was willing to accept those consequences.”
But he also said he thought the company was likely insolvent at the time it had to file for bankruptcy, rejecting assertions from former CEO Richard Fuld that the company was in decent financial health and could have been saved.
“I wish we had saved Lehman. And we tried very, very hard to do so. But it was beyond our ingenuity and capacity do to it,” he said.
Read more: http://www.politico.com/news/stories/0910/41698.html#ixzz1MAMe8YA5
John McCain — who supported the $700 billion TARP bailout, the $25 billion auto bailout, a $300 billion mortgage bailout, and the first $85 billion AIG bailout – has grandiosely announced that he will oppose Federal Reserve Chairman Ben Bernanke’s second term:
“Our country is still facing an economic crisis and while I appreciate the service that Chairman Bernanke has performed as Federal Reserve Chairman, I believe that he must be held accountable for many of the decisions that contributed to our financial meltdown.
“Therefore, I plan to oppose Chairman Ben Bernanke’s confirmation for a new term as Federal Reserve Chairman.”
“Isn’t “raising the debt ceiling” like me requesting an increase in the limit on my credit cards just so I can live at a rate higher than I can really afford?”
Yes, with the observation that you can’t fix the car and put gas in the tank and buy groceries unless that limit is raised because without those you’re not going to be earning enough to even make the minimum payment.
Bernanke sent a buck-passing letter in response to questions about the AIG backroom bank bailout payments.
In a letter to Representative Darrell Issa, the ranking Republican on the House Oversight and Government Reform Committee, Mr. Bernanke said he “was not directly involved in negotiations” over payments to A.I.G.’s trading partners to unwind tens of billions of dollars in credit default swaps. Instead, he said, these negotiations were handled primarily by the staff of the Federal Reserve Bank of New York. (Read Mr. Bernanke’s letter on the jump.)
Responding to questions from Mr. Issa, Mr. Bernanke said the financial conditions of A.I.G.’s counterparties “was not a factor in the decision regarding the amount paid to the counterparties or whether concessions should be sought from them.”
Mr. Bernanke also said he was not involved in discussions with the Securities and Exchange Commission last year about any disclosure issues involving A.I.G.
Another day, another Reid lie
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