Washington, D.C.

Bernanke Urges Financial Innovation, Cautions on Complexity 

The concept of financial innovation has fallen on hard times, but it’s a necessary tool for the economy, says Federal Reserve Chairman Ben Bernanke — so long as it’s accompanied by proper regulation. “Subprime mortgage loans, credit default swaps, structured investment vehicles, and other more-recently developed financial products have become emblematic of our present financial crisis,” said Bernanke today at a conference in Washington, D.C. “Indeed, innovation, once held up as the solution, is now more often than not perceived as the problem.”