Even though Federal Reserve Chairman Ben Bernanke has spent more of his career as a professor than as the nation's top central banker, he insisted he wouldn't lecture the nearly 175 college students gathered Monday for a question and answer session at the Rhode Island Convention Center.
"I'm not going to lecture to you," Bernanke said. "What I'm going to do is take your questions."
Bernanke addressed the students — who came from a number of colleges in Rhode Island — in a rotunda overlooking downtown Providence, the capital city of a state still reeling from the aftershocks of the financial crisis. Bernanke, who oversaw the Federal Reserve's unprecedented steps to avert economic collapse, was also in town to deliver the keynote speech at the Rhode Island Public Expenditure Council's annual dinner later Monday evening.
Brown students applied to attend the event through the Economics Department Undergraduate Group, which sent out an application asking students to answer why they would like to attend and to formulate questions for Bernanke. The department was so impressed with the quality of questions that more than 30 students were selected, rather than the 15 that were originally planned, according to Jason Yum '11.
The Brown students and others from across the state listened to answers from Bernanke on topics such as monetary policy and job prospects for students after graduation.
"You're doing the right thing by training, by increasing your education," Bernanke told the students. "Even though these are tough economic times, the return to learning, the return to developing your skills, is very high."
Responding to a question from a student concerned about college debt, Bernanke pointed to the sizeable cost of his son's medical school education but cited as a positive development the fact that "it's much less often the case that young people are unable to get the education they want because they can't get funding."
The Federal Reserve chairman also answered questions regarding the central bank's actions during the crisis and defended the Troubled Asset Relief Program and large-scale purchases of mortgage-backed securities as crucial to restoring stability to financial markets. Many people don't realize that the Fed's efforts stemmed from the need to protect the overall economy and not merely to prop up failing firms, Bernanke said.
"I thought a lot about Econ 101 during those days," Bernanke said of the height of the 2008 crisis, adding that while TARP remains unpopular among the public, the money that has now been returned with interest made the program "a pretty good investment for taxpayers." The Fed chief also said that the financial regulatory reform law passed earlier this year provides the government "new tools" to ensure that bankrupt firms do not pose a systemic risk to the economy.
But Bernanke had fewer specific answers when asked for "tips for investors" from a Brown student who would like to own his own investment firm.
Bernanke said he wasn't in the business of betting on the stock market, and if he were, "it would probably be illegal anyway."
"I get a lot of inside information," Bernanke said, eliciting laughter from the crowd.
As parting advice, he counseled students to take advantage of educational opportunities and chances to get valuable on-the-job experience.
"I'm sorry the economy's not stronger right now, but it will get stronger," Bernanke said.
Although he felt Bernanke "dodged" his question, Ben Xiong '11 still thought hearing the central banker speak was worthwhile.
"It was a really great experience to come and see someone that powerful," Xiong said.