The Federal Reserve releases transcripts of its Federal
Open Market Committee (FOMC) meetings only after a
five-year lag in order to preserve the confidentiality of the
discussions. In transcripts of the FOMC’s 2008 meetings,
one member of the Board of Governors was quoted as
saying in the April meeting, “I think it is very possible that
we will look back and say, particularly after the Bear Stearns episode, that we have turned the corner in terms of the
financial disruption.” Did this member’s analysis turn out
to be correct? Briefly explain why his prediction may have
seemed reasonable at the time.
Source: Jon Hilsenrath, “New View into Fed’s Response to Crisis,”
Wall Street Journal, February 21, 2014.