Bernanke completely floored the senator there. He was just completely oblivious to what even happened, and apparently many outsider observers were as well. It just went through many people's heads.
PS: Anyone who doesn't understand why banks receive loans of near zero percent rates and credit card people receive loans of (insert how much more) percent rates, should never even be allowed to waste precious time and opportunity to ask actual questions of your Federal Reserve chairman.
Why put so much faith in Bernanke? He was put in a position of power and, it seems, abused it.
I understand WHY they received the loans, but that doesn't make the loans RIGHT or CORRECT. The real issue, to me, is that many of these loans were made at 0% or 0.25%--and were reinvested in US Treasury bonds at greater rates. Money from nothing, quite literally. It was lent to them by a bank empowered to do so by the US government.
Not all Federal Reserve chairmen are so loose with their programs. Bernanke made a Keynsian mistake that resulted in a tripling of the US monetary supply while attempting to keep inflation near 0%. The two goals are mutually exclusive, of course.
You'd better spend your time in places where you can actually learn real macroeconomics, rather than listening to the ludicrous voices of the monetarists or their proxies like Ron Paul and other ridiculous men. The real kicker in your comment is the last paragraph, where you state that the two goals (tripling monetary supply and keeping inflation near 0%) are "mutually exclusive" as if those ideas had anything to do with what has been happening. But for a funny retort, I'd just remind you that the current inflation is below 2%. Where is the hyper inflation monetarists have been banging about for almost a decade now?
No, the real problem we face under a depression is deflation. And under the threat of deflation, you go loose in your money supply. This is not "Keynesianism". This is straight ****ing
Milton Friedman basic macroeconomics 101. Bernanke comes from a background of having studied Friedman's ideas about the Great Depression, and, if anything, has been rather conservative and too cautious about the loosening of money supply.
I am no fan of Bernanke, but these ridiculous pseudo-bull****s that spread around the nets about the role of central banks and issues about currencies and so on really piss me off. Because they aren't marginal. As we have seen in that video, it's somehow managed to become "common knowledge" that senators really believe has a grain of truth. It's pure unadulterated really *dumb* bull**** instead.