Bernanke on Housing and Economy From 2005-2007 (CNBC Videos), Clearly Underestimated Risks

Nassim Taleb was right. The Chairman of the Federal Reserve, Ben Bernanke, clearly didn't see the "accumulation of hidden risk in the system" before the financial crisis (see clip of Taleb on BloombergTV on 11/11/2010). I found a video on Youtube with various clips of Bernanke on CNBC from 2005-2007. In July 2005, when Bernanke was Chairman of the Council of Economic Advisers, Bernanke told CNBC:
"I'm hopeful that, I'm confident in fact, that the bank regulators will pay close attention to the kinds of loans being made and making sure that underwriting is done right [whoops]. But I do think that this is just a localized problem and not something that will affect the national economy."

Who was the regulator again? When Bernanke became Fed Chairman in February 2006, he was clearly wrong on the economy and misled the public. During all of his speeches in the video below, Bernanke never mentioned any risks inherent in the banking system. I recommend you see the movie "Inside Job" where it looks at not only the usual suspects involved in the financial crisis (Federal Reserve, Alan Greenspan, credit rating agencies, politicians, derivatives, Bank CEO's and predatory lenders) but economics professors that got paid to consult and direct the big banks and AIG into the ground (see the trailer). Something doesn't make sense. Is there a Keyser Söze? See the "Bernanke was wrong" video after the jump.

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