In Fed We Trust by David Wessel

1. In Fed We Trust: Ben Bernanke's War on the Great Panic is a compelling exploration of the unprecedented measures taken by the Federal Reserve in response to the 2008 financial crisis, authored by David Wessel. The book delves into the pivotal role played by then-Fed Chairman Ben Bernanke, who drew upon his extensive knowledge of the Great Depression and the limits of monetary policy to navigate the economy through tumultuous waters. Wessel provides a detailed account of the tools employed by the Fed, such as quantitative easing and emergency lending facilities, while also illuminating the debates and controversies that surrounded these actions. The narrative is rich with insights into the Fed's inner workings, the challenges faced by policymakers, and the profound effects of their decisions on the global economy. Through a blend of analysis and storytelling, Wessel not only explains the intricacies of monetary policy but also questions the implications of such measures for the future of economics, democracy, and international finance. Overall, 'In Fed We Trust' serves as an essential read for anyone seeking to understand the complexities of financial crises and the critical role of central banking in stabilizing economies in distress.

What is the main subject of 'In Fed We Trust'?

A) Personal finance management
B) The history of American banking
C) The Federal Reserve's response to the 2008 financial crisis
D) The creation of the Federal Reserve System

2. Who was the Fed Chairman during the 2008 crisis?

A) Ben Bernanke
B) Janet Yellen
C) Paul Volcker
D) Alan Greenspan

3. Which investment bank collapsed in 2008?

A) Morgan Stanley
B) Goldman Sachs
C) JPMorgan Chase
D) Lehman Brothers

4. What does TARP stand for?

A) Troubled Asset Relief Program
B) Temporary Asset Recovery Plan
C) Total Asset Recovery Program
D) Treasury Assistance Relief Program

5. Who was Treasury Secretary during the crisis?

A) Henry Paulson
B) Timothy Geithner
C) Robert Rubin
D) Larry Summers

6. When was the Federal Reserve created?

A) 1913
B) 1929
C) 1945
D) 1971

7. What was the main cause of the financial crisis?

A) Subprime mortgage crisis
B) Government overspending
C) Trade deficits
D) High inflation

8. Which government agency regulates banks?

A) SEC
B) FDIC
C) IRS
D) FBI

9. What is the discount window?

A) Stock trading platform
B) Mortgage application process
C) Bank customer service
D) Fed lending to banks

10. What does FDIC insure?

A) Stock investments
B) Real estate
C) Corporate bonds
D) Bank deposits

11. What is the federal funds rate?

A) Government bond yield
B) Interest rate banks charge each other
C) Credit card APR
D) Mortgage interest rate

12. Who appoints Fed governors?

A) Congress
B) The Treasury Secretary
C) The President
D) The Supreme Court

13. Which company received the largest bailout?

A) Bank of America
B) AIG
C) Citigroup
D) General Motors

14. What is the FOMC?

A) Federal Operations Management Center
B) Financial Operations Monitoring Committee
C) Financial Oversight Management Council
D) Federal Open Market Committee

15. What was the Dodd-Frank Act?

A) Bank bailout program
B) Financial reform legislation
C) Tax cut package
D) Housing assistance program

16. What is the main theme of 'In Fed We Trust'?

A) Personal finance advice
B) International trade policy
C) History of US currency
D) Unprecedented Fed power during crisis

17. What role did Ben Bernanke's academic background play?

A) He was a lawyer
B) He was a medical doctor
C) He was a military strategist
D) He studied the Great Depression

18. What does the term 'moral hazard' refer to in the context of the book?

A) The danger of natural disasters
B) The risk of political corruption
C) The hazard of telling lies
D) The risk that rescued institutions will take more risks

19. What is the dual mandate of the Fed?

A) Education and healthcare
B) Environmental protection and trade
C) Maximum employment and stable prices
D) National security and economic growth

20. Which institution did the Fed help rescue by facilitating its sale to JPMorgan Chase?

A) Wachovia
B) Lehman Brothers
C) Washington Mutual
D) Bear Stearns

21. How did the Fed respond to the commercial paper market freeze?

A) Created Commercial Paper Funding Facility
B) Issued new currency
C) Closed the stock market
D) Lowered mortgage rates

22. How did the Fed address bank liquidity problems?

A) Importing foreign currency
B) Closing weak banks
C) Printing more money
D) Term Auction Facility

23. How did the Fed's balance sheet change during the crisis?

A) It was eliminated
B) It expanded dramatically
C) It shrank significantly
D) It remained stable

24. What regulatory changes followed the crisis?

A) Volcker Rule only
B) Dodd-Frank Act
C) Sarbanes-Oxley Act
D) Gramm-Leach-Bliley Act

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