A history of the Fed — with 50 slides — by Professor Bernanke

Not long after Ben S. Bernanke walked into a classroom at George Washington University on Tuesday to lecture about the Federal Reserve, he brought up a movie that featured Hollywood’s most famous bank run. It was meant as a way to connect with the two dozen undergraduates in the audience.

Except it was the film “It’s a Wonderful Life” — which came out about half a century before any of the students were born.

“How many of you’ve ever seen the movie?” Prof. Bernanke asked. Virtually nobody raised a hand. “Less people are watching Christmas movies than they used to be, I guess.”

The lecture was part of the chairman’s effort to open up the secretive Fed to the outside world at a time when many in the public are skeptical of its role in bailing out financial firms and using un­or­tho­dox measures to support the economy.

Bernanke, a former professor at Princeton University, opened the class by noting that “this is what I used to do before I got into this line of work.” He then proceeded with a disquisition on the central bank’s history, accompanied by 50 slides. The first two rows of the room filled with students with name cards, while the other rows were occupied by university dignitaries and members of the media.

It was not only a sober academic talk that Bernanke delivered from the lectern but also a defense of the Fed, which has come under attack from Republican presidential candidates and other critics.

Bernanke spent time describing how the Fed was created and its evolving role in stemming financial panics, as well as the mistakes of some of his predecessors.

A second lecture on Thursday will focus on central banking since the Depression, a third will look at the recent financial crisis, and a fourth will tackle the Fed’s response to the recession and slow recovery.

Bernanke promised to read the best two or three papers written by students in the class, though he said he would not give any papers a grade.

In discussing the financial excesses of the 1920s, Bernanke’s slides showed a famous cover of Life magazine.

“Life magazine. You never heard of that, but it was a very famous magazine for a long time,” he deadpanned.

Zachary A. Goldfarb is a staff writer covering the White House, focusing on President Obama’s economic, financial and fiscal policy.
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