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(NECN: Peter Howe, Boston) It had all the makings of an epic confrontation Tuesday: Federal Reserve chairman Ben S. Bernanke speaking at the very Fed location that is casting a shadow over the nearly month-old "Occupy Boston" protest against wealth, banks, and the political power of the rich.
But Bernanke and the protesters proved to be the equivalent of ships passing in the night -- Bernanke entering and exiting the Fed without seeing or interacting with Occupy Boston, and the Occupy Boston protesters saying they saw no reason to register any protest against the Fed chair on whose watch the Fed has effectively printed $2 trillion to pump up the economy and bond markets and bail out banks.
"The Fed is an important issue, and we wanted to say something, but it's not +the+ issue,'' Occupy Boston media spokesman Nadeem Mazen said after Bernanke had come and gone. Mazen said Occupy Boston protesters believe Bernanke has proven himself to be "behind the curve" preventing and repairing the financial bubble and collapse of the 2000s and said of the Fed, "Their ears are not to the ground on these issues. Their ears are to corporations, financial services companies and other corporate interests.''
Bernanke often makes speeches that can move bond and stock markets -- but this was not one of them. In an address entitled "The Effects of the Great Recession on Central Bank Doctrine and Practice," Bernanke talked about how in light of the 2008 global financial meltdown, central banks around the world like the Federal Reserve are likely to be more strongly focused on the need to not just control inflation but maintain overall financial stability.
"Central banks are heeding the broader lesson that the maintenance of financial stability is an equally critical responsibility," Bernanke said. "Central banks certainly did not ignore issues of financial stability in the decades before the recent crisis, but financial stability policy was often viewed as the junior partner to monetary policy. One of the most important legacies of the crisis will be the restoration of financial stability to co-equal status with monetary policy."
With videographer John J. Hammann