Chairman Ben Bernanke said the slow recovery from the Great Recession and 2008 financial crisis illustrates how vulnerable the global economy is, while urging economic policymakers to learn from that lesson.
The Federal Reserve chairman noted the extraordinary steps taken by the Federal Reserve and other central banks around the world to stabilize financial systems, during a two-day conference Friday on the crisis
The Fed purchased more than $2 trillion in bonds to try and push long-term interest rates lower. The effort was aimed at encouraging lending and borrowing. The Fed has been criticized for those purchases, but Bernanke has defended them as a successful effort that guarded against an even more severe downturn.
Bernanke said academic research that is being conducted now would help central banks respond to future crises.
"This outpouring of research will help shape future central bank doctrine and policy approaches and, most importantly, should help central banks better carry out their missions to promote the public welfare," Bernanke said at the opening of the conference.
One research paper concluded that large-scale asset purchases worked. Although the paper noted that the effort might have a stronger impact if it concentrated more on mortgage-backed securities than on government bonds.
The paper was prepared by Peter Karadi of the European Central Bank and Mark Gertler, an economics professor at New York University. Gertler collaborated with Bernanke on academic research when Bernanke taught at Princeton University.