Bernanke said that the weekend in September 2008 when regulators sought desperately but in vain to save investment bank Lehman Brothers was his worst moment in the crisis.
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Bernanke did not name the individuals he felt should have been targeted.
Former Federal Reserve Chairman Ben Bernanke has said more folks active in the financial crisis should have challenged appropriate actions, in place of putting the duty around the financial businesses. Many explanations have been put forward. Ben Bernanke-chair of the Federal Reserve during the crisis, now retired-does not agree with that answer. “Should somebody have gone to jail?” “Monetary policy can accomplish a lot, but, as I often said as Fed chairman, it is no panacea.” “That is not obvious, I don’t think everybody would agree to that”, he added in an interview with CNBC.
Bernanke left the Fed more than a year ago and his memoir, “The Courage to Act“, comes out this week.
Bernanke’s partial explanation for the bankers’ get-out-of-jail-free card is that the Department of Justice-which, he emphasizes, is ultimately responsible for prosecuting the bankers-has targeted financial firms rather than individuals.
“A financial firm, of course, is a legal fiction”, Bernanke explained. “It’s not a person – you can’t put a financial firm in jail”. “Obviously everything that went wrong or was illegal was done by a few individual, not by an abstract firm”, Bernanke helpfully pointed out.
The concern is that without sufficient punishment at the individual level, there is little accountability.
Government critics have faulted regulators for failing to pursue charges for specific individuals at those big banks, claiming that allowing the firms to pay settlements makes fraud simply a cost of doing business for the industry.
Yet still, Bernanke’s comments stand out against the silence from the rest of the nation’s elites, who would prefer this massive misfire of American justice go evaporate into the refined air of a nation now apparently comfortable not only with a tiny minority holding all the wealth, but also newly unaccountable to its laws.
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“Every time I saw a bumper sticker which said, ‘Where’s my bailout?’ it hurt”, the newspaper quoted him as saying.
