Financial Crises: Lessons from the Great Depression and the Writings of Ben Bernanke

Sep 12, 2007
B-340 Rayburn House Office Building


Dr. Gary Richardson 
Professor of Economics
George Mason University

Click here to listen to an audio archive of this seminar.

Click here to view Dr. Richardson's power point presentation.

Financial crises resembling the current credit crunch occurred periodically in the United States during the late nineteenth and early twentieth centuries.  The longest and deepest contraction of the supply of money and credit occurred at the onset of the Great Depression.  Equity and real estate prices began to fall in the summer of 1929, culminating in the Stock Market Crash a few months later.  Banking panics began in the fall of 1930.  Banks failed in large numbers until the winter of 1933, when recovery began.

Federal and state governments subsequently reformed the regulatory structure of the financial system to prevent such cataclysmic credit crunches.  Those reforms formed the foundations of the financial system until the 1980s and 90s, when regulatory changes eased restrictions on the behavior of financial institutions, in hopes of increasing economic efficiency and improving the allocation of capital.  However, recent default rates on sub prime mortgages have led some to call for increased regulation and new policy changes.  Many predict a new financial crisis will occur if Ben Bernanke and policy makers fail to take action. 

In this special seminar, Dr. Gary Richardson of George Mason University will offer his historical perspective on the Great Depression, financial crises, and Ben Bernanke's economic leadership.  This course will seek to answer the following questions:

  • What lessons are applicable from the Great Depression regarding the current financial instability?
  • How has Ben Bernanke's leadership changed the Federal Reserve? How are his actions different from that of other crises?
  • How can Bernanke's writings shed light on the potential solution to the crisis, and what will be the Chairman's approach to the ongoing problems generated by sub prime mortgage loans?