Customer Reviews

Ben Bernanke's Fed: The Federal Reserve After Greenspan

5 star:		(11)
4 star:		(11)
3 star:		(20)
2 star:		(1)
1 star:		(1)

 

 

Though just published in May of 2008 this book about the Federal Reserve and its current head, Ben Bernanke, is already dated. Since this book's publication Lehman Brothers has collapsed (ironically the book's author Ethan S. Harris was their leading economist), Barack Obama has been elected in last year's Democratic election sweep and the national unemployment rate has soared to over 10%. These happenings have to have affected Bernanke's leadership of the Federal Reserve. However despite its problem with timeliness, the book still provides some useful information and insight in to the way the Federal Reserve operates, the financial "rock star" Greenspan's legacy and how Bernanke is likely to guide the Federal Reserve through the remainder of his term (or perhaps terms?). Not exactly a fun read but accessible and informative to those with a basic understanding of the U.S. economy.

I was hoping that in reading this book I could become better informed on either Ben Bernanke or the Federal Reserve. I was really looking for something that identified the structure, how decisions were arrived at, how much we really don't know about the reserve...etcetera. In fairly simple terms the structure of the Federal Reserve and how it works was laid out. I honestly think that there is simply too much information to pack it all in to one book and so I felt like I was on a bit of a speed course in some areas.

I would like to know a bit more about Ben Bernanke himself, the sections on why he's the right man for the job felt a little propaganda-ish, repetitive without substance.

This book is still worth a quick read for reference even if much of what is there is out of date (final edit May 2008). And for beginners in finance there are some useful sections. I particularly liked p. 124, which tells us what Bernanke will do. It is about the only forward looking comment in the book, along with the not very adventurous ("going out on a limb") recommendation that the Fed should be forward acting in heading off bubbles by at least leaning against them.

Adjusting for limitations on perspective and additional market blow ups that followed final edits on the book, this is still an establishment book. The work itself is relatively shallow, and repetitive, given some collage work from the author's day job as a brokerage economist. Harris does tell us some of the writing comes from his brokerage notes. But he, or the editors, should have tried to cut out sections that went over the same material again. Instead of going deeper in a later chapter, we merely go around the same topic again. How many times do we hear that "Bernanke was one of the leading students of the depression?"

The biggest problem is the misleading nature of the title. We are told this is going to be a book about Bernanke. Yet, physically, the entire first part of the book is about Greenspan. When we get out of the Greenspan sections, we nonetheless get taken back to Greenspan countless times.

Conclusion: This is an establishment book. At the margin it is useful for quick reference. But let's recall how we got into this financial mess. We had passive analysts recycling consensus thinking to passive managements, bankers, regulators, investors, etc.

I recommend readers check out the analysis in the New Monetarism. And let's hope more thinkers come along to write in-depth, updated analysis of the Fed and its control/guidance over the flow of money in the largest economy in the world. Until then, keep reading raw news items, and blogs, and seek to draw your own conclusions.

With a new democratic regime in office and the last tremors of the late 2000's housing collapse still being felt, a great deal of what is discussed in this book is already extremely dated. I must agree with another reviewer who commented that the writing style in general is a bit dry. After reading this book, you'll get a decent enough understanding of the U.S. economy and it does provide some useful insight on how the Fed operates but I have to believe there are better reads out there than this particular piece that will be better equipped to maintain the reader's interest and provide more up to date information.

When I picked up the book I noted that the author, Ethan S. Harris, is listed as "Managing Director and the Chief U.S. Economist for Lehman Brothers". I could only wonder what role he played in the demise of Lehman Brothers as the lead economist and hoped it didn't influence me as I read his book. I don't believe it did but it did serve to reinforce the book's often repeated concept of economics as an inexact science. I actually learned a lot about how the Fed has as it's objective the balancing of unemployment with lowering inflation and using monetary policy as the Fed's tool in achieving the balance. I found it very interesting that the Fed will not state what an acceptable inflation rate or unemployment rate is. They prefer to refer to their objectives in terms of "constructive ambiguity" which is left to Fed watchers to interpret and by doing so not unduly influence the capital markets and their liquidity. The book does an excellent job of describing the structure, function and political independence of the Fed. Harris also does a nice job of crafting a timeline of events during Greenspan & Bernake's tenures and how the Fed Chairmen reacted to the dynamics of the economy. However, just when I thought I was getting the hang of the way the Fed works I got to the section on the "housing bubble" which was identified as early as 1998 as home price inflation began to exceed consumer price inflation and attributed it to easy mortgages, speculative "flippers" and hot markets getting hotter. Ironically, in 2008 Greenspan wrote that "the Fed is blameless on the property bubble"and defended the Fed as having raised interest rates throughout the period (Harris argues not aggressively enough) and that housing bubbles are localized and tend to be self correcting. So now I'm not certain what I learned by reading this book but at least I understand how the Fed works if not why it does what it does. It will remain to be seen how Bernake performs in using monetary policy to help the US economy lift itself out of the most serious recession since the 1930's without creating hyperinflation. I have a hunch it will be an interesting ride.

I've gotta admit I was a Greenspan fan...if there is such a thing. Greenspan may not have always been right or have perfect foresight, but he kept the Fed on track for a good long while. Then along comes Bernanke. Even after reading the book, I'm not sure of what to think of him. Why? Because the book often seems at odds with what Big Ben does in real life.

I'm not sure he's the guy to lead us through the quagmire of where America, indeed, the world, is right now.

The book is a good overview of Bernanke's qualifications, his reasoning and his initial reign. But again, it feels more like a story book than a real review of the man. Time will tell.

I thought this was one of the best books I have read on the Federal Reserve. While obviously it talks a lot about Bernanke's history and his ideology. What I found even more interesting was its discussion on how the Fed affects our economy. It does so in terms that anyone can understand and does not get into any complicated jargon. I would highly recommend this book if you are interested in not only Bernanke's history and how he is different from Greenspan but also if you are just interested in how the Fed works.

Are you wondering what is going on at the Federal Reserve now that Greenspan is
gone? Wondering how Bernanke's meshing with the existing framework? Maybe you want
to see what the Fed is doing to alleviate the countries most recent financial troubles?
Well, if those are what you are looking for, you will not find them here.

What you will find is a book that is well written and goes indepth into why Bernanke
is the right man for the job. Unfortunately, it does this in a rather repetitive method.
The book focuses more on what has happened than on why it was the right or wrong thing
to do. Instead of going into detail in certain areas (after all we aren't all economists)
the book glosses over them as if "Of course this is what they did."

Of course a lot of the insight that the book offers is already data. We've been through
a Presidential election and the economic crisis has deepened. We'll either have to wait
for an updated version sometime in the future, or keep an eye on the news ourselves if we
want up-to-date information.

This is a concise and easy to understand book about Ben Bernake and his current chairmanship of the Federal Reserve. I am not a expert in economics but I found this book interesting. Ben Bernake is the current Fed chairman and has been since 2005. Ethan S, Harris sees him as being a very positive force in the Fed but the jury is still out. Bernanke has so far handled his job well. Ethan Harris begins the book by describing what the Fed does, what the job of a chairman and 12 governors are, and how long the Fed has been operating in the US. He addresses the success and failures of former chairmen, and that of Charles Volker and Alan Greenspan. He then addresses Ben Bernake and his tenure. I did learn a lot and read the book in about 2 hours.

This book is an insider's look at the Federal Reserve. Much of what is written can be found in media releases over the years; very little is new information that has not been previously printed or discussed. Dr. Harris is certainly a credentialed insider earning his PhD in economics from Columbia University and a work background with J. P. Morgan, the Federal Reserve Bank of New York, and Lehman Brothers.

The subtitle of the book, "The Federal Reserve after Greenspan" provides a reasonable summary of the content. This book limits itself to the public face of the Fed with some summary observations about the Fed's efforts to respond to the economic challenges which have developed over the past years.

There are some interesting comparisons and contrasts made between the Greenspan era and the Bernanke Fed. In his last chapter, Dr. Harris poses the question as to whether or not President Obama will retain or replace Bernanke; he concludes with a quote from a screenplay, "All About Eve" by Joseph L. Mankiewicz, "Fasten your seatbelts, it's going to be a bumpy night!" This has certainly been true so far, and dawn may be slow in coming.

Having been published in 2008, the book cannot address the dramatic changes which have taken place recently. Dr. Harris does bring the reader's attention to some of the trends which led to the current situation, but carefully avoids any serious reference to the political forces which were at work during that period.

My impression of the book is that it is an insider's book for insiders. If you are a banker, you may enjoy the book; if you're not, then it may not be for you.