Fed releases transcripts of meetings from 2008 financial crisis

WASHINGTON -- The Federal Reserve on Friday released transcripts of its 2008 meetings when central bank policymakers were grappling with the financial crisis.

The transcripts from official Federal Open Market Committee sessions are made public after five years. The Fed posted hundreds of pages of verbatim transcripts, taken from audio recordings, on its website.

The latest release includes emergency conference calls as Fed officials tried to deal with worsening financial conditions that culminated in September of that year with a crisis that led to the bailout of insurance giant American International Group and other extraordinary measures.

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At a Sept. 16, 2008, meeting, for example, the transcripts showed an unvarnished account of Fed officials trying to analyze and react to the crisis.

“Sorry for the late beginning,” then-Fed Chairman Ben S. Bernanke said at the start of the meeting.

“The markets are continuing to experience very significant stresses this morning, and there are increasing concerns about the insurance company AIG,” he said.

Later in that meeting, Fed economist David Stockton briefed officials on the worsening economic situation, noting that “the rise in the unemployment rate is remarkable.”

“I don’t really have anything useful to say about the economic consequences of the financial developments of the past few days,” he said. “I must say I’m not feeling very well about it at the present, but I’m not sure whether that reflects rational economic analysis or the fact that I’ve had too many meals out of the vending machines downstairs in the last few days.”

The comment elicited laughter, according to the transcript.

“But in any event, we’re obviously going to need to wait a bit to see how the dust settles here,” Stockton continued, “but I think the sign would be obviously in a bad direction.”