WASHINGTON (AP) — Chairman Ben Bernanke says the Federal Reserve was forced to choose the best of several bad options when it stepped in to shore up the largest U.S. financial institutions during the 2008 crisis.
Bernanke is defending the central bank's actions to support insurance giant American International Group and help with the sale of investment bank Bear Stearns in a speech prepare for a New York conference examining the crisis.
He says the billions of dollars in loans the Fed provided were backed by adequate collateral and taxpayers did not lose money. He says the Fed would now have better options to deal with a crisis given a sweeping overhaul of financial regulation Congress passed in 2010.
