Ben Bernanke

I think one of the lessons of the Depression - and this is something that Franklin Roosevelt demonstrated - was that when orthodoxy fails, then you need to try new things. And he was very willing to try unorthodox approaches when the orthodox approach had shown that it was not adequate. ”

Home purchases that are very highly leveraged or unaffordable subject the borrower and lender to a great deal of risk. Moreover, even in a strong economy, unforeseen life events and risks in local real estate markets make highly leveraged borrowers vulnerable. ”

The Federal Reserve has always recognized the importance of allowing markets to work, and government oversight of financial firms will never be fully effective without the aid of strong market discipline. ”

Stronger regulation and supervision aimed at problems with underwriting practices and lenders' risk management would have been a more effective and surgical approach to constraining the housing bubble than a general increase in interest rates. ”

The actions taken by central banks and other authorities to stabilize a panic in the short run can work against stability in the long run if investors and firms infer from those actions that they will never bear the full consequences of excessive risk-taking. ”

I assure this committee that, if I am confirmed, I will be strictly independent of all political influences... essential to that institution's ability to function effectively and achieve its mandated objectives. ”

I generally leave the details of fiscal programs to the Administration and Congress. That's really their area of authority and responsibility, and I don't think it's appropriate for me to second guess. ”

Many foreclosed homes are neglected or abandoned, as legal proceedings or other factors delay their resale. Deteriorating or vacant properties can, in turn, directly affect the quality of life in a neighborhood, for example, by leading to increases in vandalism or crime. ”

The Federal Reserve can only buy Treasuries and agencies, and moreover quantitative easing typically involves buying longer-term Treasuries and agencies in terms of bills, for example. ”

In the future, financial firms of any type whose failure would pose a systemic risk must accept especially close regulatory scrutiny of their risk-taking. ”