Live-blogging Ben Bernanke [UPDATED]

I’m listening via conference call to Federal Reserve Chairman Ben Bernanke deliver this speech to the Council on Foreign Relations. 

There will be Q&A afterwards, which I shall liveblog with updates to this post. 

UPDATE:  Looking at the speech, I’m seeing some eliding of the international dimension of policymaking (which is kind of odd, given that it’s a speech at the Council on Foreign Relations).  Consider:

I also will not say much about the international dimensions of the issue but will take as self-evident that, in light of the global nature of financial institutions and markets, the reform of financial regulation and supervision should be coordinated internationally to the greatest extent possible.

and: 

[G]iven the global operations of many large and complex financial firms and the complex regulatory structures under which they operate, any new regime must be structured to work as seamlessly as possible with other domestic or foreign insolvency regimes that might apply to one or more parts of the consolidated organization.

Y’know, you can’t just wish these things into being.

ANOTHER UPDATE:  Ah, I’m seeing the Fed requests for greater supervisory authority: 

Currently, the Federal Reserve relies on a patchwork of authorities, largely derived from our role as a banking supervisor, as well as on moral suasion to help ensure that critical payment and settlement systems have the necessary procedures and controls in place to manage their risks. By contrast, many major central banks around the world have an explicit statutory basis for their oversight of these systems. Given how important robust payment and settlement systems are to financial stability, a good case can be made for granting the Federal Reserve explicit oversight authority for systemically important payment and settlement systems.

And here on whether the Fed should be the institution to provide "macroprudential" supervision for systemic risk: 

As a practical matter… effectively identifying and addressing systemic risks would seem to require the involvement of the Federal Reserve in some capacity, even if not in the lead role. As the central bank of the United States, the Federal Reserve has long figured prominently in the government’s responses to financial crises. Indeed, the Federal Reserve was established by the Congress in 1913 largely as a means of addressing the problem of recurring financial panics. The Federal Reserve plays such a key role in part because it serves as liquidity provider of last resort, a power that has proved critical in financial crises throughout history. In addition, the Federal Reserve has broad expertise derived from its wide range of activities, including its role as umbrella supervisor for bank and financial holding companies and its active monitoring of capital markets in support of its monetary policy and financial stability objectives.

ANOTHER UPDATE:  OK, now the Q&A!

Bernanke does not expect any "major disagreements" with either Treasury or the Obama administration on any proposed legislative reforms. 

He sees recovery beginning in 2010. 

He observes that between 1929 and 1931, the Great Depression was your garden-variety financial panic.  It was the collapse of Austria’s Creditanstalt Bank in 1931 when things really went south.  Obviously, he’d like to avoid a replay of that trigger event. 

On proposed reforms of accounting rules:  "These things move slowly… there’s a lot of more deliberation."  Wants to see more rapid movement at the global level. 

In response to a question about whether he’s worried more about inflation or deflation:  "Mostly I’m worried about the overall economy." 

When asked about the international dimension, he gives a pretty vanilla response — greater coordination between jurisdictions, etc.  He is skeptical of the G-20 producing a detailed coordination proposal (as opposed to providing overall guidance).  Bernanke praises the actions following up the October G-7 meeting by central banks at injecting liquidity into the system.   

His closing comment:  "economics is not music or math… it’s useful only to the extent that it helps people.  Economics is not worth the effort unless it’s applied in a way that helps people in the world." 

LAST UPDATE:  Here’s a link to Jack Healy’s write-up in the New York Times.