Ben Bernanke Is Still Stuck in the 1930s

"When asked about whether letting Lehman Brothers collapse last year was the right move, Bernanke replied: "There were many people who said, 'Let 'em fail.' You know, 'It's not a problem. The markets will take care of it.' And I think I knew better than that. And Lehman proved that you cannot let a large internationally active firm fail in the middle of a financial crisis. Now was it a mistake? It wasn't a mistake for the following reason: we didn't have the option, we didn't have the tools. All the Federal Reserve can do is make loans against collateral," Bernanke said. In other words, it wasn't my fault."