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Bernanke on ‘Occupy Wall Street’: Fed not part of the problem

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Federal Reserve Chairman Ben Bernanke sympathized with the “Occupy Wall Street” movement’s dissatisfaction with economic inequality at a press conference Wednesday, but said protesters should not blame the Fed for bailing out the banks.

Bernanke responded to a question about “Occupy Wall Street” by saying that he was dissatisfied with the state of the economy as well, particularly with the high unemployment and income inequality.

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“It’s been going on,” he said, “increases in inequality have been going on for at least 30 years. But, obviously, as that has continued we now have a more unequal society than we’ve had in the past.”

The Fed gave out $16.1 trillion in emergency loans to U.S. and foreign financial institutions between Dec. 1, 2007 and July 21, 2010, according to figures produced by the government’s first-ever audit of the central bank.

Out of all borrowers, Citigroup received the most financial assistance from the Fed, at $2.5 trillion. Morgan Stanley came in second with $2.04 trillion, followed by Merill Lynch at $1.9 trillion and Bank of America at $1.3 trillion.

“I think that the concerns about the Fed are based on misconceptions,” Bernanke continued. “The Federal Reserve was involved, obviously, in trying to stabilize the financial system in 2008 and 2009, a very simplistic interpretation of that was that we were doing that because we wanted to preserve, you know, banker salaries. That is obviously not the case.”

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“What we were doing was trying to protect the financial system in order to prevent a serious collapse of both the financial system and the American economy. And we needed to take those steps. If we hadn’t taken them the consequences would have been dire.”

The audit also found that the Fed mostly outsourced its lending operations to the very financial institutions which sparked the crisis to begin with, and that they delegated contracts largely on a no-bid basis. The GAO report recommends new policies that would eliminate such conflicts of interest, and suggests that in the future the Fed should keep better records of their emergency decision-making process.

The audit was conducted on a one-time basis, as mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, passed last year.

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When Bernanke was asked about the “Occupy Wall Street” protests in early October, he said that excessive risk taking on Wall Street and the failure of financial regulators “had a lot to do” with the recession.

“Well, I would say very generally I think people are quite unhappy with the state of the economy and what’s happening,” Bernanke said. “They blame, with some justification, the problems in the financial sector for getting us into this mess, and they’re dissatisfied with the policy response here in Washington.

“And at some level, I can’t blame them,” he added. “Certainly 9 percent unemployment and very slow growth is not a very good situation.”

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With prior reporting by Stephen C. Webster

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… then let us make a small request. Like you, we here at Raw Story believe in the power of progressive journalism — and we’re investing in investigative reporting as other publications give it the ax. Raw Story readers power David Cay Johnston’s DCReport, which we've expanded to keep watch in Washington. We’ve exposed billionaire tax evasion and uncovered White House efforts to poison our water. We’ve revealed financial scams that prey on veterans, and efforts to harm workers exploited by abusive bosses. We’ve launched a weekly podcast, “We’ve Got Issues,” focused on issues, not tweets. Unlike other news sites, we’ve decided to make our original content free. But we need your support to do what we do.

Raw Story is independent. You won’t find mainstream media bias here. We’re not part of a conglomerate, or a project of venture capital bros. From unflinching coverage of racism, to revealing efforts to erode our rights, Raw Story will continue to expose hypocrisy and harm. Unhinged from corporate overlords, we fight to ensure no one is forgotten.

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2020 Election

Mass rallies, crazy decisions, grandiose posturing: This is what living in a dictatorship feels like

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Another week of shaking our heads and wondering how much longer we can survive him. Yet again, Donald Trump overwhelmed practically everything with the force of his obscene personality, running his mouth and his thumbs even while he was failing to run the country in any sort of conventional sense. He doesn’t actually do anything, but he dominates everything. Living in America today is like being trapped in a room with him — no doors, no windows, no exits, only Trump and the sound of Trump and the hideous image of Trump, all day, every day, for day after day after day.

This article first appeared in Salon.

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Trump officials furious with NRA over ‘dick move’ leak of LaPierre phone call: report

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President Donald Trump originally appeared interested in strengthening federal background check laws in the wake of deadly mass shootings in El Paso, Texas and Dayton, Ohio. Then, after a phone conversation with National Rifle Association CEO Wayne LaPierre on Tuesday, Trump reportedly assured him that background checks were "off the table" and pivoted to discussing anything but guns.

It was a depressingly familiar moment for Trump, who also previously headfaked toward some minor gun control reforms after the Parkland school shooting and quickly walked them back.

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Former Dem Senator hilariously nails perfect impression of ‘pouting’ Trump at G7 because nobody ‘likes him’ there

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During the "Overtime" segment of HBO's Real Time, former North Dakota Sen. Heidi Heitkamp (D) made fun of Donald Trump before he arrived at the G7 summit in France,m saying he will pout his way through the weekend because the other world leaders loathe him.

With host Bill Maher asking how the Trump will conduct himself, Heitkamp immediately went into a very recognizable arms-crossed pout, which caused the audience to burst into laughter.

After the two posed as Trump and Geerman leader Angela Merkel from the last get together, Heitkamp had a few things to say about the president.

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