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How the Federal Reserve broke the American economy: Investigative journalist Christopher Leonard on the risks of quantitative easing

Podcast & Video

This episode of Hub Dialogues features host Sean Speer in conversation with with journalist and award-winning author Christopher Leonard about his fascinating new book, The Lords of Easy
Money: How the Federal Reserve Broke the American Economy.

They discuss the the U.S. Federal Reserve’s extraordinary program of quantitative easing during the 2010s and its economic, social, and political consequences.

You can listen to this episode of Hub Dialogues on Acast, Amazon, Apple, Google, Spotify, or YouTube. The episodes are generously supported by The Ira Gluskin And Maxine Granovsky Gluskin Charitable Foundation.

SEAN SPEER: Welcome to Hub Dialogues. I’m your host, Sean Speer, editor-at-large at The Hub. I’m honoured to be joined today by bestselling author and business journalist, Christopher Leonard. I’m grateful to speak with him about his most recent book, The Lords of Easy Money: How the Federal Reserve Broke the American Economy, which documents what he calls the “ZIRP era” of extraordinary monetary policy between the 2008 global financial crisis and the COVID-19 pandemic. Christopher, thanks for joining us at Hub Dialogues, and congratulations on the book.

CHRISTOPHER LEONARD: Thanks for having me. I appreciate it.

SEAN SPEER: Who is Thomas Hoenig, and why is he such a crucial figure in your story?

CHRISTOPHER LEONARD: Thomas Hoenig is the kind of guy that might not usually get a lot of attention. He’s a senior official inside the U.S. Federal Reserve Bank. So the Fed is the central bank of the United States. They make new dollars. They control the supply of dollars. Extraordinary power, really. And the Fed has extraordinary power that’s concentrated in the hands, really, of a committee of 12 voting members. These are the folks that gather every six weeks and decide whether the Fed’s going to cut interest rates, raise interest rates, do whatever.

So, Tom Hoenig is a guy who sat on that committee during what I really do think is the most consequential time period in the history of the United States Fed. And I don’t say that lightly, but what we’re talking about here is the year 2010, okay? So this is after the global financial crisis. It’s in the wake of that huge emergency. And this was a time when the U.S. Fed decided to embark on this very experimental, very unprecedented path of we just have to say “hyper-aggressive money printing” or “easy money.” Tom was the guy who tried to stop it. He was the Fed official who voted against it. And he’d been remembered by history as this sort of cantankerous dissenter who voted no all the time. But the real story’s a lot more complicated than that, as I discovered.

SEAN SPEER: A key reminder in the book is that even before the extraordinary quantitative easing in response to the global financial crisis, the Federal Reserve and other central banks around the world were running historically low interest rates. Let me ask a two-part question. First, why were rates so low in the first half-decade or so of the 2000s? Second, what role did Federal Reserve policy play in actually precipitating the 2008 crash?

CHRISTOPHER LEONARD: Wow, great questions. I mean, it’s so interesting when the Fed cuts interest rates—when it has so-called easy money policies—the best way to think about that is the central bank is trying to juice economic growth by making money cheap. It’s encouraging speculative investment. It’s encouraging borrowing. It’s encouraging trading in the stock market. It’s pumping up the prices of houses and stocks. So it’s pumping dollars into the economy at the most basic level. Our central banks had a very interesting history under Alan Greenspan, who’s this legendary chief of the Fed from 1987 to 2006. The Fed was able to print more money and have easier money policies without stoking the one real negative break on Fed action, which is price inflation. I walked through it in the book. It’s a little complicated. 

But for the purposes of this, let’s say that by the year 2000, the Fed found that it could really keep interest rates lower than most people thought was possible without stoking inflation. And they kept facing crisis after crisis. The dot-com bust of 1999, the terrorist attacks of September 11th, 2001, which were coming amidst recession already in place, and every time there’s kind of this downturn or turbulence, the Fed would respond by lowering rates. It’s pretty clear that between 2003 and 2006, ball park, the Fed kept rates too low for too long. It just kept the—the borrowing was too easy, the money was too plentiful, and it directly contributed to the housing bubble in the United States. I mean, it’s intuitive. When rates are low, you borrow more money to buy more houses, the price of houses goes up. It was all carried by low rates. Then in ’06, the Fed tried to hit the brakes, and the whole thing came crashing down.

SEAN SPEER: In response to the crisis, the Federal Reserve launched a program of quantitative easing that even Hoenig himself voted in favour of. Do you want to talk a bit about the rationale and scale of that early program?

CHRISTOPHER LEONARD: Totally, totally. Okay, so the Fed is really interesting. The Fed is the only institution on earth that can create new money out of thin air. The Fed literally creates dollars out of thin air, and it does that incidentally by making these new dollars appear inside these special bank accounts on Wall Street. It doesn’t create money in like Chris Leonard’s chequing account. It creates money in Wells Fargo, J.P. Morgan, Goldman Sachs. Okay. So the Fed has tremendous power in the sense it can create new money. And we built the Fed in 1913 to manage our currency, the United States dollar, to keep it on an even keel and also to be there in the case of financial panics. So the idea is when our banking system faces a panic and it’s about to collapse, the Fed will step in and say, “Hey, we’ll print money, we’ll lend it to healthy banks, and then when the crisis is over, we’ll get repaid to keep everything stable.”

So in 2008, the global financial crisis was a bank run on steroids. It was a massive, massive seizure of the global financial system. And the Federal Reserve stepped in and used its emergency money printing powers at just an extraordinary level. They basically created a trillion dollars out of thin air. To put that in context, that’s about as much money as the Fed had created in the first 95 years it was around. And I can walk through the details of that. So basically, they print a century’s worth of money in about a year, really. And they were loaning money to foreign central banks. They were funding bailouts of United States banks. And one of the things they did was not noticed at the time, and it was called quantitative easing. And they just went out into the market and directly purchased home loan debt and United States government debt, treasury bills, by creating new dollars.

Here’s what’s so crazy about the Fed. You start talking about it, and it gets pretty technical, really quick. It’s not like it’s rocket science, but there are just mechanics to it. But the Fed had never really purchased home loan debt before in the way they did with quantitative easing in the crisis. Look, to me, the important thing is, is that the Fed did this emergency measure of quantitative easing in ’08 as part of this huge rescue, and nobody really complained. The main character in the book, Tom Hoenig, who’s a relatively small-c conservative, who believes the Fed should use its power with restraint, even this guy voted for it. He’s like, “Hey man, this is a five-alarm fire. We’ve got to put it out.” But the book really starts in late 2010. Totally different era, okay?

Look, things were terrible in the American economy. Unemployment was 9.7 percent in 2010. The crisis was over, but growth was still weak. We had this huge hangover from the debt crisis. And this is the moment when the Fed basically started saying, “We’re going to use money printing as a jobs program. We’re going to try to drive U.S. economic growth through quantitative easing.” That’s really where the story starts. That’s when the Fed really expands its role in our economy and undertakes a set of policies. I just can’t overstate it enough that we’re experimental and unprecedented in quantitative easing.

SEAN SPEER: Christopher, we’ll come to this prolonged period of extraordinary monetary policy in a minute. But I just want to talk a bit about the transition from the crash to the post-2010 world that you’re talking about. A fascinating insight in the book is how little scrutiny the Federal Reserve’s quantitative easing in the context of the global financial crisis received from the media and others. Why do you think that is?

CHRISTOPHER LEONARD: It’s so fascinating. And so, look, I’m an investigative reporter in the U.S. that covers big business. I’ve written about giant corporations, and I’ve written about monopolies. And so much attention was given to the bad actors of the financial crisis, appropriately. Countrywide Mortgage, like these basically scam artists that were doing these loans that had no hope of being paid back. But what struck me was the very large role that the central bank played. Fraud and scam and corporate malfeasance is the weather, and the Fed creates the climate. And the Fed created the climate of cheap money and easy money that fuelled all this stuff in the 2000s. And it came to a crashing stop in ’08. Now, is the Fed 100 percent responsible? Of course not. It’s a big complicated picture. But the Fed played a huge role in creating the crash.

But to your point, when the crash happened, the only attention that was given to the Fed was it was like the firefighting team or the rescue squad that came in and printed a bunch of money to stop the carnage. And so most of the attention around the Fed was like, “Oh my God, thank God we’ve got Ben Bernanke here to bail us out.” And believe me, I felt that. I was like clinging to the bottom rung of the middle class back then. I was glad they did the bailout and stopped the carnage. But it’s time to scrutinize the role they play. And so the question is, why don’t the policies get more attention as they’re happening? And look, I think a big part of this is that the Fed’s actions seem so complicated and they seem so removed from our daily life.

I actually really like the analogy of climate. It’s hard to wrap your head around climate change, and it’s tough to stand back and look at the large-scale effects of what the central bank does when it either tightens or loosens the money supply, but it’s driving the climate. The problem is twofold here. Look, all central banks are built to shield themselves from voters. They’re not elected. The heads of central banks tend to be appointed by elected representatives that never run for election. And then, furthermore, they really cloak their actions in this very complex, difficult-to-understand vocabulary and jargon. I mean, just the phrase “quantitative easing” really means nothing, and we can talk about what it is mechanically. But so, I think that they feel removed from daily life, and they emphasize that by pretending that what they’re doing is so complicated, we can’t understand it.

SEAN SPEER: I would just say in parentheses that the observation about the lack of scrutiny is not merely a perception. The book details, using media analysis, how little there was of reporting at that time about what precisely the Federal Reserve was doing.

That’s a good segue, Christopher, to your broader point, which is the extent to which the Federal Reserve’s program of quantitative easing continued well after the crisis. What was the rationale for continuing quantitative easing and zero-bound interest rates after the U.S. economy had resumed growing?

CHRISTOPHER LEONARD: Basically, it’s just fascinating. The guy who led the Fed in 2010 was Ben Bernanke. And so he was Fed chairman during the crash of ’08. And he was famously a student of the Great Depression and really had this general mindset that it was always better to do more than less, and never get caught not acting. Because his conclusion, which was based on good evidence, is that, back in the Depression, the Fed didn’t do enough. The Fed kept money too tight, but also that misses a lot of what happened after the Depression. And this is really important actually. After the Depression in the U.S., the United States responded with big government action. I mean, it’s called the New Deal. The Fed broke up banks, they put Wall Street under all these new regulations. The federal government empowered labour unions, they did public works programs.

None of that was really happening in 2010. So Ben Bernanke had this theory that “Okay, here we are in 2010, unemployment’s still high. Economic growth is still weak. We still have this terrible hangover from a global financial crash. We don’t have a new deal, so let’s have quantitative easing. Let’s drive job growth by printing money.” And so let me please, if I could, really quickly explain what quantitative easing is, because it’s fascinating. This is where it all started for me. The Federal Reserve has a trading desk, a trading floor, in New York City that I’ve toured. It’s inside the New York Fed. It looks like the trading floor of just a big bank like J.P. Morgan or something with all these 20-something people in fleeces with little anemic plants on their desks doing financial trading. Okay. And there’s literally one room over in the corner where a Fed financial trader will sit down at a desk and he’ll call up, or he or she will call up, a bank on Wall Street.

And the Fed Trader will say, “Hey, we want to purchase $8 billion worth of Treasury bills from you at this price.” And the bank says, “Okay, here you go.” The bank sends the Treasury bills to the Fed, and the Fed, through a few clicks of the keyboard, creates $8 billion out of nowhere that appears inside the reserve account of that bank. So what quantitative easing is, is replicating that transaction again and again and again until you have created, at first, hundreds of billions of dollars and, later, trillions of dollars, inside these bank accounts on Wall Street. And so, to put it in perspective, between ’08 and 2015, the Fed printed three and a half trillion dollars. That’s three and a half times as much money as it printed in the first 95 years of its existence. The other way I’d put that is that’s like 350 years’ worth of money creation in about four and a half or five years. And all that money is like a tidal wave heading into Wall Street. Then, after that, it’s searching out a place to exist and live in the economy. So that’s why it fuels buying stocks, buying bonds, buying corporate junk debt. It pumps up asset prices.

So Ben Bernanke, in 2010, was saying, “Hey, the Fed has never done quantitative easing before. It’s never tried to do this kind of aggressive money printing.” But the economy’s moving sideways. It’s no coincidence that all this started literally the day after the midterm elections of 2010, when the Tea Party movement in the United States took over our Congress, which basically sidelined Congress. So it was all this decision of, like, “Hey, the Fed’s going to step in and drive economic growth.”

SEAN SPEER: It’s fascinating. Similarly, just to put some of those numbers in perspective, Christopher, that’s about one and a half times the size of the Canadian economy. So we’re talking big dollars.

You just outlined some of Ben Bernanke’s thinking behind the ongoing program of quantitative easing through 2010 and beyond. One thing that struck me in the book was how successful he was at persuading the other governors to follow him in this what you describe as an extraordinary monetary policy experiment. Why is that? Why was he ultimately so successful at getting support for this agenda?

CHRISTOPHER LEONARD: First of all, he’s a very adept political leader of the central bank. And what’s implicit in that question, that I think is really important to point out, is that there was a lot of opposition to doing this. My guy, Tom Hoenig, who’s the main character, voted no, actually eight times in a row, not to do this. But he wasn’t the only person who was against it. You look back at the transcripts of the meetings they had, and there were at least four or five members of this top committee who said, “Do not do this.” Okay? QE, as they call it, is going to be very risky. It’s going to have a lot of unintended consequences, and we’re not going to get much out of it.

I mean, honestly, I’m not trying to be glib. My jaw dropped when I read through the transcripts. And the benefit in terms of the jobs that were going to be created from this was tiny. It was going to reduce the unemployment rate by like 0.3 percent, which is a lot of jobs, but look at the side effects. So I’m going to answer your question about how Bernanke essentially pressured these people to go along. But first, it’s important to note, “Hey, what could be the matter with pumping money into the economy to create jobs?” Assuming that you’re okay with government intervention, it doesn’t sound that bad. But you have got to remember this money is going to the big banks first, and it is fuelling asset growth. Banks buy bonds; they buy stocks.

The model that we used after the Great Depression of 1929 was totally different. We literally hired people around the country to build dams, build roads, and that puts money in the pocket of people who spend it at the ground level. Quantitative easing is pumping up Wall Street and the banking system. And these people inside the Fed were saying, “Hey, we’re just going to have another giant bubble, is what’s going to happen. You’re going to enrich the banks. You’re going to pump up stock prices. We’re barely going to create any jobs.” But it was very important to Bernanke that not just that the Fed did this, but that the vote was essentially unanimous, with one person voting against him. And he did it. And he talks about it really openly in his memoir that he published in 2015. He’d get these officials at the Fed one-on-one, harangue them, cajole with them, try to come up with a deal, and get their vote lined up before the actual meeting happened. So all the votes were lined up. And Ben Bernanke put tremendous pressure on this one guy who was voting no to get in line and try to show total consensus.

SEAN SPEER: Yeah. I want to pick up something you mentioned earlier, Christopher, which is that one of the main arguments against the normalization of monetary policy through this era was the ongoing absence of price inflation. It begs the question: why? What explains it in the period between the global financial crisis and the pandemic?

CHRISTOPHER LEONARD: So in 2018—it’s in the book I think I have that year right, I think it’s ’18, not ’19—there was this huge forum at this prestigious think tank in D.C. called the Brookings Institution. And so this forum had Janet Yellen. Gosh, I think Ben Bernanke was there. Paul Krugman, the famous leftist economics correspondent, was there. And the topic was, why haven’t we seen price inflation? 10 years, we’ve been pumping money into the economy, every model, including the Feds—I looked back at the Fed’s internal forecasts, and they kept getting it wrong. They kept expecting more inflation. And so, basically, at this Brookings Institution thing, it’s clear they had no clue. We really don’t know. Well, I think we have a better idea now, but price inflation never rose in the way we thought it would when you print so much money.

And inflation, as we’re seeing today, it really is a function of pumping too many dollars into an economy when there’re too few goods to be purchased. So you have all these dollars chasing stuff to buy, which drives up the price. Now, we got to make a really important point here, which is that we never saw price inflation significantly, okay? TVs, cars, hot dogs, all these consumer items were pretty flat in terms of price. We saw tremendous inflation in a different market for assets, like houses, stocks, corporate debt. We saw double-digit, consistent inflation in those markets, huge inflation. But when that happens, we love it. We call it a stock market boom, okay? You pay the price later, but we liked it when it was happening. Look, I think at the end of the day, we did not have significant inflation because the Fed was dumping all this money into the global economy during an era that was incredibly deflationary. I think largely because of these global supply chains we were building.

I don’t think it’s a coincidence that the first huge inflation wave we saw came on the heels of massive global supply chain disruptions. And at that Brookings event I talked about, this was one of the big things they talked about. Like, geez, is it the fact that there’s all this cheap labour in China and cheap goods in China? I don’t know. Maybe it’s that, maybe it’s the fact that people have faith that the Fed will control inflation, therefore inflation doesn’t happen. So I mean, the supply chains come to a shuddering halt and inflation explodes, and I don’t think it’s coincidental.

SEAN SPEER: You’ve alluded to it a couple of times, but I want to put it to you more directly. You have an excellent chapter that outlines the various economic consequences of this era of cheap money, including asset bubbles, the rise of so-called “zombie companies”, and growing inequality. Do you want to elaborate a bit on how you’ve come to think of these consequences?

CHRISTOPHER LEONARD: Totally. I have to own my position at the end of reporting this book, which I think is that quantitative easing is a terrible way to create economic growth. Let me explain it in two simple ways. I mean, first of all, the Fed knew that the way this was going to boost economic growth was by driving up asset prices, driving up the price of stocks, bonds, and real estate. Well, you look at the United States, the richest 1 percent of the people in the U.S. own, I think, about 40 percent of all of our assets, and the bottom half of everybody else owns about 5 percent of the assets. So when the Fed is pursuing this policy to drive up asset prices and create growth, it’s enriching the very richest. It’s widening income inequality, which is probably the preeminent economic issue in the United States right now. Income inequality. 

It’s totally tearing apart our society, honestly. I think it’s at the root of a lot of our ills right now. To specify that, I mean, the wealth creation for a small group of people at the top has been astounding. Literally, they don’t know what to do with the money. And then a huge bulk of the population is working harder than ever and slowly sinking behind. It creates a great deal of tension. So this policy drives up income inequality, number one. And number two, it creates massive financial instability. When you pump up the stock market by printing money, the stock market will fall when you have to tighten the money supply. And we saw the Feds stoke bubbles during the dot-com era by keeping rates too low and stoking speculation. We saw them do it during the housing bubble.

We’ve seen them do it again in this era that we’re writing about when they’ve pumped up these markets and then really accelerated it in 2020. I mean, the last part of the book is about the COVID bailouts, which the Fed created. I talked about them creating three and a half trillion dollars and how stunning that was. The Fed created north of $5 trillion in 2020 and 2021, pumped directly into the stock market. And so you’ve got the U.S. economy stagnating and trying to figure out how to move forward, and markets are just exploding, right? That’s unstable because those prices can’t stay that elevated forever without continued intervention.

SEAN SPEER: One interesting insight in the book from British central banker, Paul Tucker, is that the growing role of central banks in the modern economy is, in large part, a function of political choices. That central banks have become “overmighty citizens” because politicians prefer to delegate tough decisions. It’s a fascinating point. How is it that politicians have actively ceded their policymaking responsibilities to bankers?

CHRISTOPHER LEONARD: I’m so glad you brought that up. That Paul Tucker wrote a book called Unelected Power. I think that is what it’s called. And he talks about the overmighty citizens of the central banks, and he’s so spot on. I hate to say this, but I think we’re worse off here in the United States than our good neighbours up to the north in Canada, who just seem perpetually more stable and sane than we are. But in the U.S., our democratic institutions are defined by paralysis and dysfunction. We’re just seeing it again and again. We had a run here, strangely, unexpectedly under Biden where they passed industrial policy and the huge COVID bail. It’s like that was an anomaly. So, what you see is that as your democratic systems become more dysfunctional and less able to act, a nation continues to operate, but it just relies on the more undemocratic institutions.

Here in the U.S., we rely on our Supreme Court to mediate a lot of our public policy issues. We rely on the military to handle foreign policy issues. And on economic stuff, we rely on the central bank, which wasn’t built to be the primary driver of economic growth. It was built to manage a currency, which are totally different things. And so, definitely, over the last decade—and I’m thinking right now of this woman who was a senior Fed official, she’s one of these people on the voting committee, named Betsy Duke, who told me that she just saw this again and again that the politicians saw the Fed as free money because the Fed doesn’t have to tax anyone to create these dollars. And so when you’re having a bitter dispute in Congress about taxing and spending and you can just keep fighting in circles and not getting anywhere, well, the Fed can just turn on the money hose.

That would be great, I guess, if it was a sustainable root of prosperity and growth, but money printing is just not that. You can’t rely on it forever. So yeah, I think the democratic institutions here have really enjoyed the luxury of dysfunction. They’ve been allowed to not do their job, and the Fed has stepped in to try to print money to get us out of it. And let me please, I mean, even in the good old days of 2019, prior to COVID, the U.S. budget ran a structural deficit of a trillion dollars a year. That means when our economy is growing, things were great. Unemployment was 3.7 percent. Things were not great, by the way, in terms of income inequality, but there was growth, and we were still borrowing a trillion dollars a year to run the government because the government wouldn’t make decisions about taxing and spending. So anyway, in a situation like that, you rely on the central bank to act.

SEAN SPEER: Do you get a sense, Christopher, that we are poised to learn the lessons from this extraordinary experience? Or do you think that central bank orthodoxy, not just in the United States but really around the Western world, has failed to reckon with the cost and consequences of this extraordinary period of monetary policymaking?

CHRISTOPHER LEONARD: I mean, we’ve consciously decided we are going to put all of our energy into not reckoning with it. And by that, I mean—okay, let’s look at corporate debt markets, which I talk a lot about in the book. Corporate debt reached a record level in 2020, okay? In this era of easy money, corporate debt almost doubled from 6 trillion to about 11 trillion in the United States. We’re talking about very highly-leveraged companies that just borrowed ridiculous amounts of money at low interest rates. They were indebted up to the hilt. And then, when a downturn came, they started to default like those homeowners in the subprime crash. Rather than face the consequences, the Fed literally went out and started buying corporate junk debt for the first time and pumped trillions of dollars into the banking system to stop it.

And God, man, I don’t wish economic turmoil upon anybody; it’s not what I’m going for here. But what we keep doing is bailing out the system by printing money. And so we are just in the most bizarre situation today. In early 2023, the Fed has started to tighten the money supply because they’re facing inflation. And really, the key way to kill inflation is by tightening the money supply. And we’re going to see if that has the consequence of the chickens coming home to roost or whatever you want, that all this risky debt and risky speculative debt will correct downwards. And it’s clear Wall Street hasn’t wrapped its head around the fact that we have moved into a higher interest rate environment. I mean, that’s on the front page of the Wall Street Journal. Wall Street doesn’t take the Fed seriously. They don’t think this is real. They think the Fed is going to cut rates this year again. The Fed has hiked rates up to four and a half percent, and it’s going to hit 5 percent, but Wall Street doesn’t think that it’s going to stay there.

So we put so much energy into not reckoning with this stuff, and I just don’t know where we’re going to go from here. Maybe the Fed will cut rates again. But I’ve got to get back to the central point that really preoccupies me. I am sincerely convinced the U.S. is living through the symptoms of really unhealthy income inequality. I mean, you hear it again and again that people in this country think the system is rigged against them; they’re exhausted, they’re overworked, they’re living paycheque to paycheque. A lot of people are, and that’s a super negative consequence of this kind of economic policy where you’re pumping up stocks and the middle class is just stagnating treading water for 10 years. It doesn’t really work. So I think we’re already seeing the consequences.

SEAN SPEER: Yeah. Again, as an aside, Christopher, we’re seeing similar fissures emerge in Canadian society around the issue of housing affordability in our major cities, where young generations are looking at the prospect of home ownership in Toronto, Montreal, or Vancouver, and it seems increasingly beyond their reach.

My final question is about the institutional culture that produces these outcomes. We’ve already talked about the lack of scrutiny. The book highlights the long ovation that Bernanke received in his final Fed meeting, and, of course, he just won the Nobel Prize last year in large part for his translation of theory into practice during the global financial crisis. It may be that reasonable people can agree or disagree with individual policy choices, but what explains the lack of public debate and dissent and the presence of such hubris in your story?

CHRISTOPHER LEONARD: Well, I do want to underscore the point that there’s tremendous hubris, and listen, I’m perplexed. I mean, I went into this book thinking I was writing an explainer book. One of my role models is Michael Lewis, the great business reporter, and his book, Moneyball, is just a really cool book explaining a system. And I thought I was going to do that with quantitative easing. But reading through the internal debates and looking at this decision-making was unbelievable. Ben Bernanke took so many huge risks and was so astoundingly wrong about so much. You just look at the debate about quantitative easing in 2012. Bernanke had his staff draw up a forecast of what was going to happen. All the numbers are in the book; it’s stunningly wrong. They were wrong on inflation. They were wrong on how easy it was going to be to stop these programs.

When Bernanke wrote his memoir in 2015, he declared victory. He’s like, “QE worked.” And he’s saying we won the ballgame in the third inning. It’s like, this thing is still going. And I don’t know why it is this way. I mean, it’s pretty easy to explain why more people don’t talk about the Fed every day. It’s complicated. They purposely cloak it in complicated language. We don’t vote for Fed people. So it doesn’t enter the lexicon a lot. I mean, I can attest to personal experience, it is impossible to get people on cable news to talk about the Fed. Unless you’re on Bloomberg and you’re talking for business investors who just care about which way the interest rates are going to go so they can make money. But for you and me and normal people out here, trying to figure out what’s going on in our economy, there’s not much public discussion about it.

But the incredible awe and respect, and the fact that Bernanke just seems beyond criticism, is mind-blowing to me. I’ll be totally honest. I don’t understand it. I think that this guy is totally reckless. The hubris is on the record; it’s not me saying this. This guy was stunningly dishonest with the American people in 2010 when he went on 60 Minutes and said that the Fed’s not printing money, which, by any common understanding, was intentional non-truth. And yet the guy—well, so he won the Nobel Prize, and that’s fine. But as a business reporter, it really is important to get down the facts of what’s happened and really give people a clear understanding of the dynamics that have led us to where we are today and what’s at stake, what it means when we talk about the Fed hiking rates of 5 percent, and what that’s going to look like for the rest of us for the next year or so if it stays there. That’s important. Those facts are immutable. I mean, the current chairman of the Fed, Jay Powell, is wrestling with the beast of Ben Bernanke’s legacy right now. And he’ll never put it that way, but that’s what’s going on.

SEAN SPEER: Well, Christopher, you said that it’s hard to have public conversations about the Fed. We were grateful to have had you on Hub Dialogues. The book is The Lords of Easy Money: How the Federal Reserve Broke the American Economy. Christopher Leonard, thank you so much for joining us.

CHRISTOPHER LEONARD: Thank you for the time. I really appreciate it.