Review — The Courage To Act
Ben Bernanke is a very smart man. After reading his book, ‘The Courage To Act’, I cannot think of a better person to lead the Federal Reserve during the financial crisis of 2008. Whether you agreed with the decisions the Federal Reserve and US Treasury made during the financial crisis or not, this book lays it out in a very detailed and matter-of-fact way. It cuts through the headlines and gets to the nitty gritty of what the Federal Reserve does and why it did what it did during the crisis.
The financial crisis of 2008 almost lead us into a second Great Depression. Bernanke walks you through the crisis and the Federal Reserve’s response in a step-by-step manner which makes for a very detailed and dense read. He even goes back to the Great Depression to give context. While informative and insightful, it is not a summer beach read by any stretch.
One thing that I did appreciate about Bernanke was his candor when it came to Congress and testifying. He was up on Capitol Hill a lot during the crisis and thereafter. While he and the Federal Reserve worked closely with members of Congress such as former Senator Chris Dodd and Representative Barney Frank, he’s very clear that he could never get use to the doublespeak from members of Congress. How behind closed doors they would say one thing then when in public they would say another. I for one would not have the temperament to deal with that as well as Bernanke did over the years.
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Another anecdote that Bernanke drops in that I enjoyed is from his youth. It’s about how he was in the first grade….for two weeks. It was evident early on that he was smart or as he puts it, “I remember seeing seeing a book on my parents’ shelves, with a title something like Your Gifted Child. I was six. I knew perfectly well what it was about.” Not bad for a six year old and his passion for economics and monetary policy is second to none.
Again, this is a very detailed and dense book. If you are not interested in the financial crisis of 2008 or just think that Bernanke, Tim Geithner and Hank Paulson did nothing but bailout Wall Street then I would advise against picking up this book (unless you want throw it). If you are looking for more insight into how the Federal Reserve works and want a blow-by-blow of it’s decision making during the financial crisis then this book is for you.
