Research into the causes of the financial meltdown and the risks taken on by banks is of “critical importance” to averting another disaster, Fed Chairman Ben Bernanke said today.
“The recent financial crisis has spurred a great deal of research on its causes and, more broadly, on the topic of systemic risk and its regulation. This research is of critical importance,” he said in his prepared remarks. “It can inform the design and implementation of macroprudential regulations and policies, and I suspect no one in this audience needs to be convinced that we must get this right.”
The Dodd-Frank Wall Street Reform and Consumer Protection Act now requires the Federal Reserve to take a “macroprudential approach” to financial regulation, he added.
“…That is, to consider the health of the financial system as well as the health of individual firms and markets,” Bernanke said in brief opening remarks to a Federal Reserve conference in Washington, D.C.
Economists and analysts sift the statements of the Fed’s chairman and board of governors for indications of further economic stimulus, such as additional quantitative easing measures.
Bernanke’s opening remarks for the conference on the regulation of systemic risk precedes Federal Reserve Governor Daniel Tarullo’s speech at 1:45 p.m. EST discussing industrial organization and systemic risk. The Federal Reserve Bank of Philadelphia will release its monthly business outlook survey at 10 a.m. EST.
The conference kicked off just after the Labor Department announced that weekly jobless claims rose by 11,000 to 428,000, seasonally adjusted. The rise was higher than the expected 1,000 increase in claims.
Also this morning, the Bureau of Labor Statistics announced prices for urban consumers increased 0.4 percent in August on a seasonally adjusted basis. The consumer price index for all urban consumers has increased 3.8 percent since last August.