Courtesy of Pam Martens.
Former Fed Chair Ben Bernanke: What Did He Know and When Did He Know It
Based on the appointment calendars of Former Fed Chairman Ben Bernanke obtained under a Freedom of Information Act request filed by Wall Street On Parade, and the newly released Fed transcripts and documents from the financial crisis era, we are able to reconstruct the August 2007 panic that gripped the Fed Chairman, notwithstanding the dozens of headlines now proclaiming the Fed remained in the dark about the seriousness of the crisis.
It started with a call to Bernanke from Citigroup’s Robert Rubin at 5 p.m. on August 8, 2007. By the next morning, it appeared that the Fed Chairman had gone into a high state of alert.
At 11:00 a.m. the next morning (August 9, 2007) Bernanke met with Lewis Ranieri, the granddaddy of mortgage backed securities and a pioneer in the securitization market. Fed Governor Randall Kroszner and Sandy Braunstein, the Fed’s Director of the Division of Consumer and Community Affairs also attended this meeting.
Immediately after a lunch break, Bernanke hauled in a wide swath of the hedge fund world. It is noteworthy that the Fed Chair chose to meet alone with these men with no other Fed Governors or Fed staff present. This raises the question, was Bernanke attempting to restrict information at the Fed as to just how dangerous the crisis had become?
The hedge fund meeting included Ray Dalio of Bridgewater Associates whose newsletter had just the month before warned of the crazy leverage in the system. Aleksander Weiler, formerly of Tremont Capital and then at Weyerhaeuser Asset Management was also in attendance as were hedge fund money managers Stephen McMenamin and David Storrs.
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