U.S. Federal Reserve Chairman Ben
Bernanke said Tuesday that financial education helps boost the U.S.
economy but monetary policy can't solve all economic problems.
"Financial education supports not only individual well-being, but
also the economic health of our nation," Bernanke said in a speech
for a town hall meeting with educators gathered in the Fed office.
"As the recent financial crisis illustrates, consumers who can
make informed decisions about financial products and services not
only serve their own best interests, but, collectively, they also
help promote broader economic stability," he added.
The central bank chief touched little upon future monetary policy
moves of the Fed, but noted the Fed's policy independence and
limitations in response to questions.
Bernanke said an independent central bank could make monetary
policy and other decisions without being influenced by short-term
political pressures. "It is very important to have that degree of
independence."
He said the Fed is nonpartisan and makes decisions based on
technical analysis, but not political considerations. A lot of
provisions, such as the terms for Fed officials and chairman, give
the Fed independence in decision making.
Bernanke reiterated that monetary policy is not a panacea and
there are many issues which could be more properly dealt with by
fiscal authorities through tax policies and spending decisions.
Long-term issues, like providing strong educational system and
good tax code are responsibilities of a wide variety of
policymakers, said Bernanke, a former Princeton University
professor.
He also defended the Fed's decision of keeping the benchmark
interest rates at record low for more than 3 years, saying that the
U.S. economy is in "fragile recovery," and the low interest rates
would help economy to recover and employment to restore to more
normal levels.
