A fascinating look at the Great Panic of 2008 (and beyond) | In FED We Trust: Ben Bernanke's War on the...

Great Book | In FED We Trust: Ben Bernanke's War on the Great Panic | David Wessel

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	• In FED We Trust: Ben Bernanke's War on the Great Panic David Wessel Crown Business, 2010 - 352 pages average customer review:based on 55 reviews view larger image
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Seems to be more Bernanke's story than an analysis of The Great Panic...

Even though we're still in the middle of it, I've been wanting to read some material on the economic meltdown that started back in 2007. To that end, I took the opportunity to get a copy of In FED We Trust: Ben Bernanke's War on the Great Panic by David Wessel from a publicist. To be fair, this is the first book I've read on the topic, and I am by no means an expert on the economics and politics of the Federal Reserve. Yet, while reading In FED We Trust, I felt that I was getting a slanted view on things, one that was probably more pro-Bernanke than what an attempt at a purely objective analysis would be.

Content:
Introduction - Whatever It Takes; Let Ol' Lehman Go; Periodical Financial Debauches; Age of Delusion; There Are Jews in Boston, Too; Pas de Deux; The Four Musketeers - Bernanke's Brain Trust; RE: RE: RE: RE: RE: RE: Blue Sky; Running from Behind; Unusual and Exigent; Fannie, Freddie, and "Feddie"; Breaking the Glass; Socialism with American Characteristics; World of ZIRP; Did Bernanke Keep His Promise to Milton Friedman; It Could Have Been Worse; Notes; Glossary; Selected Bibliography; Acknowledgments; Index

The book is very much focused on Ben Bernanke and his handling of the Federal Reserve. The author goes into his background, his academic foundations, and his focus and analysis of The Great Depression. That academic style shaped much of Bernanke's work in government, making him more of a consensus-seeker than an authoritarian leader, as well as someone who chose his words carefully instead of being blunt and fully open. He also made most of his decisions with the main goal of avoiding The Great Depression 2.0.

What I appreciated most was the chronological story flow of how the first domino started to wobble, and the debate around letting the financial institution fail as opposed to rescuing it. As each new crisis hit, there were fewer and few options, as the "healthy" institutions had already been tapped out for bailing out the failing banks and financial firms. And even if they had been able to absorb them, the Fed had shown their willingness to step in to do "whatever it takes" to make sure things kept running. As such, there were a few games of "chicken" to see who would blink first when it came to stepping up.

My major takeaway from this book was simply that economics is not a science, and that nobody can predict the cause and effects of financial actions with any degree of certainty. I've heard it said that running the economy is like driving forward while only looking in the rear view mirror. After reading In FED We Trust, I am again reminded of that saying, and I am even more convinced of its validity.

I'm sure other books about the financial crisis will be written, and I'll definitely have to read them to get a better overall view of what happened, as I'm not sure that In FED We Trust is the best overall objective analysis and story of what happened.

Disclosure:
Obtained From: Publicist
Payment: Free

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A fascinating look at the Great Panic of 2008 (and beyond)

At last a book that uses plain English to explain the financial meltdown of 2008. You don't need a PhD in Economics to understand what happened. Bear Stearns bailout, Lehman Brothers losses, AIG rescue, bank re-caps - this book explains it all so that the average person can understand what happened. If you're looking for a detailed analysis, this isn't the book for you.

What I learned from this book:

**a greater understanding of Ben Bernanke as a person and not just a figurehead. As Chairman of the Federal Reserve Board, he's one of the most powerful men in the U.S. Yet, his ego didn't drive his decisions. I really felt that he tried to do what was best for the country.

**the causes of the financial crisis are many and complex. Sure, you can sum it up in a word - greed. But to look beyond that and see the inter-relationship of low interest rates, easy credit and investors looking for higher returns and becoming ever more willing to take risk. We had so many years of prosperity, many think it will last forever. Well, it doesn't.

**studying the past can help with the present. Ben Bernanke is an avid student of the Great Depression. He's one smart guy and his knowledge helped him stay calm during this whole saga. Wall Street has always been a place of excesses. It seems as soon as regulations are put into play, the Wall Streeters come up with new and ever-more complicated financial products to get around the regulations and give investors high returns.

**sometimes all your choices are bad and you must pick the lesser of two evils. Many people are very angry at Wall Street, myself included. I've experienced unemployment and my blood boils when I read about the exorbitant bonuses paid to executives of AIG and the like. I don't like thinking about the companies that the government bailed out with taxpayer dollars. But after reading this book, I can start to understand that the bailout might have been the lesser of two evils. Would the financial markets have crashed? Maybe, maybe not.

I love books that keep me thinking, even long after I've finished reading them. In Fed We Trust is such a book. I'm still pondering the following:

**Did Ben Bernanke succeed or was he a failure? David Wessel presents both sides of this.

**What have we learned from all this? I so wish I was back in business school and could study this full-time. Oh well, I will have to do this on my own.

I highly recommend this book to anyone wanting to understand better what led up to and what happened during the Great Panic of 2008. Even if you believe that Ben Bernanke and the Fed failed in their roles, you will get something from this book.

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Great Book

"In Fed We Trust" takes a look at the causes of the downturn of our present economy. While most people find economics dry and boring, this book is far from it. Not only does this book speak intelligently about the "panic" of September 18th, 2008, it also compares it to the other great panics of United States history, the Great Depression being the major event.

It also gives you the understanding that many of the issues at we now face were born way before Bernanke's time. It doesn't dismiss actions of any party but gives a historical account in order for the reader to make their own decision on the matter.

This book gives you an understanding not only of Ben Bernanke and "where he came from" but an understanding of the pressures he and his staff were under. While slightly biased in its view of Bernanke, the book takes not prisoners. Right or wrong, they did what they could do and what they thought was right. This book cuts past the media's stories and gets to the real meat of the matter. While I don't think it gives earth shattering revelations, it gives the "regular Joe" understanding of the Fed.

If you are looking for an deep economic study, this book is not for you. BUT for anyone who wants a historical account of what started the bottom falling out of the economy, this book is a must read.

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A nice start and worth a read....wanted to know more

This is a great book and is much more than just about Federal Reserve Chairman Ben Bernanke's handling of the recent and on going financial mess in the USA. It is about men and women whom we have been led to believe are the best and brightest, being exposed as fools who often know less about money issues than the sane, responsible average American who has never been in debt and has always been wise about money management.

Would have liked to have read more about how connected the men (mostly men) at the Fed and in banking, finance in general are be it friendship or former working relationships which like in any business, will tend to create a comfort zone that may not be healthy for the country and citizens.

And as the subtitle of the book notes it is about how the unelected and certainly un founding fathers like, the Federal Reserve has become as the 4th branch of government. Sad when one considers that way to many Americans cannot name the other 3 legit branches of government. In the book one will read of other unknown entities like the Council of Economic Advisors, and international monetary fund groups and individuals that if you are alert and interested as you are reading, you may feel your eyes glazing over.

Sadly most Americans will not read this book because they are more interested in sophomoric media stories about do nothing celebrities, and sports figures. The same Americans who have gotten themselves into a deep financial gutter, and are naive enough to think the Fed cares, aside from throwing some crumbs in hopes the citizens will quiet down and continue to believe that everything will be alright. Never mind that these same Americans have no idea or don't care that it is China that has kept the USA from going under financially. That the stimulus checks Americans have gotten, came about because of massive China loans to the USA, and in turn many of not the majority of Americans will spend the money on Chinese made goods, and the the Fed will pay huge interest on the borrowed money and in essence China will be a winner multiple times over.

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"In Fed We Trust" has some good info, but comes up short

I found the events around Columbus Day 2008 interesting, when the (9) largest banks were invited for a meeting without an agenda.

The congress meetings are begging for someone to give us more detail and this book was disappointing in this area. Was Harry Reid the only person to have objected to the TARP request? Hardly! what if TARP was denied? what would have happened? Something other than "If it doesn't pass, then heaven help us all" would be nice. Wassel could have expanded, but chose not to. He really came up short.

?Whatever it takes?

That was Federal Reserve Chairman Ben Bernanke?s vow as the worst financial panic in more than fifty years gripped the world and he struggled to avoid the once unthinkable: a repeat of the Great Depression. Brilliant but temperamentally cautious, Bernanke researched and wrote about the causes of the Depression during his career as an academic. Then when thrust into a role as one of the most important people in the world, he was compelled to boldness by circumstances he never anticipated.

The president of the United States can respond instantly to a missile attack with America?s military might, but he cannot respond to a financial crisis with real money unless Congress acts. The Fed chairman can. Bernanke did. Under his leadership the Fed spearheaded the biggest government intervention in more than half a century and effectively became the fourth branch of government, with no direct accountability to the nation?s voters.

Believing that the economic catastrophe of the 1930s was largely the fault of a sluggish and wrongheaded Federal Reserve, Bernanke was determined not to repeat that epic mistake. In this penetrating look inside the most powerful economic institution in the world, David Wessel illuminates its opaque and undemocratic inner workings, while revealing how the Bernanke Fed led the desperate effort to prevent the world?s financial engine from grinding to a halt.

In piecing together the fullest, most authoritative, and alarming picture yet of this decisive moment in our nation?s history, In Fed We Trust answers the most critical questions. Among them:

? What did Bernanke and his team at the Fed know?and what took them by surprise? Which of their actions stretched?or even ripped through?the Fed?s legal authority? Which chilling numbers and indicators made them feel they had no choice?

? What were they thinking at pivotal moments during the race to sell Bear Stearns, the unsuccessful quest to save Lehman Brothers, and the virtual nationalization of AIG, Fannie Mae, and Freddie Mac? What were they saying to one another when, as Bernanke put it to Wessel: ?We came very close to Depression 2.0??

? How well did Bernanke, former treasury secretary Hank Paulson, and then New York Fed president Tim Geithner perform under intense pressure?

? How did the crisis prompt a reappraisal of the once-impregnable reputation of Alan Greenspan?

In Fed We Trust is a breathtaking and singularly perceptive look at a historic episode in American and global economic history.

From the Hardcover edition.

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