We take you through the details and impact of that announcement. We are asking our viewers what you think Ben Bernankes legacy will be when he steps down from the fed. Give us a call. Epublicans, 202 5853881 democrats, 202 5853880. Independents, 202 5853882. Outside the u. S. , 202 5853883. You can also catch up with us on twitter, facebook, or email us. A very good thursday morning to you. Ofwant to begin with some the front pages about that ben bernanke press conference. Here is the financial times. A picture of ben bernanke. A historic end to the tenure. Over to the front page of usa today money section. A bit from the front page of the wall street journal. That is the lead to that story on the front page of the wall street journal. Here he is announcing the decision to taper monthly asset buying. [video clip] let me just say that one of the things i am proud of and i have tried to accomplish over the past eight years is to increase the transparency of the fed and to increase the accountability of the fed. You mentioned those trips to capitol hill. I testified many times, as have a number of my colleagues. There is this notion that the fed is not audited or that it has all kinds of secret books. As you well know, we have complete openness to the general accountability office. We have an Inspector General of our own. We have a private Accounting Firm that does all the books as well, under very tough standards. We publish regular reports on s. L aspects of our we are open to doing that. Host that was ben bernanke talking about the changes in the fed legacy under his tenure at the head of the fed. We will be talking about that with our viewers. We want to talk to you about this decision about dialing back the bond buying program. I want to bring in sudeep reddy. The taper announcement was an important and to end to Ben Bernankes tenure. The fed has been putting its foot on the gas as far as it will go to try to stimulate the economy. We went through an incredible recession. The fed was able to arrest the decline, in part through an initial round of bond buying. Printing money out of thin air so that it could go out and purchase bonds and lower Interest Rates as a result to try to stimulate the economy by leading people to buy houses and cars and other assets on credit. N as being e having done a reasonably good job after failing to catch the crisis on the front side. It is now in its third round of bond buying qe3. Fed has been doing this since september 2012. That is a long time to be printing 85 billion per month. It is not completely chillier when this would end or how it would end. Six weeks clear when this would end or how it would end. End of hisefore the tenure, he was able to forge a consensus on the committee to pull back the bond buying. Theyre slowing the pace of their purchases. Over the course of the eight meetings throughout the year, they plan to scale back by 10 billion per month, eventually at the endn to zero of 2014. The fed will continue to keep Interest Rates very low, that is the other half of its decision. It will keep it near zero at least through 2014 and into much of 2015. That helped boost the stock market and helped the dow should up to a record on wednesday shoot up to a record on wednesday. Host here are some charts from the wall street journal showing the Dow Jones Industrial average when that announcement happened. Also, reaction in the 10year treasury yield. Explain the treasury yield line. Guest the borrowing cost for the government. For is the benchmark rate all sorts of loans across the economy. It is very closely connected to mortgage rates. You could follow that and get a good sense direction only on what will happen to mortgage rates. Springbelow 2 in the when the fed was fully moving on qe3, when it was buying all these bonds with no end in sight. Once it started discussing that in april and may, you could see the 10year yield spike up. It is no close to 3 . It is still a historically low level for a treasury yield, for borrowing bonds. But it is certainly higher. It is a rapid adjustment to go a full percentage point in a matter of months. That is one of the things that scare the fed. The rapid runup of rates. You could see the Housing Market deposit bit over the summer as a result of that potential homebuyers assented to wait to see how this would play out. Some businesses were wondering what this might mean to the recovery. What ben bernanke was able to do is delay the process and by sometime and at least start startme time and at least the tapering. It will be up to janet yellen to carry out the full scaling back of that program over the next two years and eventually start raising Interest Rates, which will be a whole other level of drama. Will bedeep reddy joining us for the first 45 minutes of the show to help answer the questions you might have about the fed. We want to get your thoughts about Ben Bernankes legacy as he prepares to step down at the end of next month. Here is a wall street journal piece. Mr. Bernanke has succeeded in changing an institution once so committed to secrecy. He avoidedtenure, the mumbling and of hisehensible syntax predecessors. The fed will someday stop buying bonds and raise Interest Rates. After that, his impact will be that is mr. Bernanke with his predecessors. We are taking your thoughts and comments this morning. We will start on the republican line. Oklahoma city, oklahoma. Advance vance. Caller i think that his legacy will be that he has solidified our political regime as the government of the banks, by the banks, and for the banks. The United States is now a bank ocracy. It is one where what can be done politically by either party is severely limited by a group of s that basically control the parameters of what can possibly be done in the political sphere. Reserveult, the federal has a monopoly on the creation powerful in is all the sense that it has never been so before. All this talk about bernanke being transparent and Holding Press Conferences and speaking in declarative sentences and such is really a kind of smokescreen, a publicrelations grip uponis deepening the lives of this nation. Ance from oklahoma city, oklahoma. Twitter. Es in on the rich get richer. 38 . Lity ratings unfavorably by 31 . We will go to steve from dayton, ohio. It democrat line. Caller how are you doing . Bernanke is a thief. He is a liar and a thief. I checked out his background. He was taking money from places he shouldnt have been. Host why do you call him a thief . Them and can look at tell that he is. You can tell by looking at him and the way he talks. Host new jersey, independent line. Good morning. Caller ive got a question mostly about the Mortgage Backed securities he has been buying for the past couple of years. Does your guest have an idea about whether or not these are private securities that he is taking out of the market from the banks since they hold the securities, they have 2 trillion worth of these securities are they influenced by having the securities to keep Interest Rates low . , theserest rates go up private securities that they own will become worthless. Host question for sudeep reddy. That is actually a great question. That is something the fed will have to grapple with for the coming years. It owns just about 4 trillion right now buying government bonds and buying Mortgage Backed securities. That willall assets likely come under pressure as the yields rise and as the prices of those assets adjust over the coming years. That is a cost that the fed has a knowledge to and that they will face in the coming years. Onthey are facing losses this portfolio in the coming years or at least not turning in as much profit to the treasury, the fed has been turning over money to the federal government as a result of holding these inds if that were to stop and improving the economy, that will not be that much of a problem for the fed. The overall economy is improving as a result of the feds actions. Letting go of some of these issues will my be that difficult. The problem for the fed is if we end up being in this very weak recovery and the fed is also taking losses on its portfolio. It will have a lot to answer for at that point. That is probably a question for a couple of years from now when we have a better sense of whether we have come out of this long recovery in better shape whether we are still struggling. Host note you got that answer, what is your take on Ben Bernankes legacy . I kind of agree with the two previous colors. Callers. I think he basically muddled his way through it. As far as the way he was speaking to people, i dont know if you would call that clear and concise. He seemed to be meandering in his thoughts quite a bit. I listened to him when he gave , which you course televised very nicely for him. It seemed like he just didnt have the kind of brainpower that is want in a guy that running the most powerful organization in the world. Host thanks for the call. One other piece on this. After burning key exits the fed, how will history judge him . That is the question in the washington post. Gotten the economy through as tumultuous it. A period the fed has ever faced in its 100year history. Did not have the perfect tools for the job, but he searched his Academic Knowledge of how economies work and used to the tools he did have to try to put americas jobless back to work. And theby neil irwin washington post. We are taking your calls. In little over a month before he is set to step down. Steve is from chatsworth, illinois. Democrat line. Caller good morning. There are a few things he is doing wrong and has been doing wrong. Keeping the Interest Rates low or so low we are not raising m up sooner, he is buying or purchasing the Mortgage Backed securities at such a drastic level that our dollar is going to be worth less, not in two years, not in three years, but in 1015 years. This will be the worst thing for our United States. , the top corporations 500 and all the banks, are taking advantage of this because they get such cheap Interest Rates. Backare going to be buying all of their stocks and it is still going to be the 1 that are going to be rising because people were so scared after 2008 the whole collapse that they did not want to go into the stock market, which they should have. They did not know what to do. Not for twoiting, or three years down the road, i am going to be waiting for 10 or 15 years. I dont know if the caller ever read the book whom bust economy economy but i will take my comments now. Host Richard Rogers writes in on twitter. Tweet. Er we are talking about in bernankes legacy on the washington journal. We want to play you a little bit more from his press conference yesterday in which he talked a little bit about the feds performance at the start of the fiscal crisis. [video clip] , we were slow to recognize the crisis. I was slow to recognize it. In retrospect, it was a traditional, classic crisis, but in a very different guise. It made it for a historian like me very difficult to see. Whether or not we could have prevented it or done more about it, that is another question. Time i32,006 by the became chairman and house prices by the time i became chairman , it was 2006 and house prices were already declining. We have done everything we can think of to strengthen the fed possibility to monitor the Financial Markets and take actions to stabilize the economy and Financial Markets. I think we are much better prepared to deal with these events than we were when i became chairman. Host in watching the press conference, west wing reports was tweeting about it for their news site. Had his shareusly of critics, but watching his last News Conference thinking that history is likely to judge and quite positively. We will go to rick from louisville, ohio. Independent line. Caller lets go back to our constitution. Wrote that ars corrupt Banking System was more of a threat to our country than a freestanding army. Im 55 years old. I grew up in detroit. I grew up when there was a Banking System that was not corrupted. The beginning of this is Ronald Reagan. You can look at the treasury. When you go back to the 1930s the Treasury Department issued bonds. That is how the hoover dam was built. This Treasury Department 1000lly manipulates trillion dollars worth of derivatives and it actually creates 75 of our gdp. It quadruples the price of oil. Got the 250 billion barrels of oil. You triple the price of that. You leverage it 30 times. And you buy bonds with that oil money to brinker Interest Rates to zero and then you take the china trade we have a deficit with china. China sends the surplus to the treasury and they buy bonds. You let me jump in and ask the way the fed has run now, you are fairly concerned about it. What you think about the future of the fed . Caller we have to have a revolution in this country. Freedom ofre the speech and freedom of press comes in. With the fed and the treasury. These are the jews. Host i will cut you off there. I want to go you on the janet yellen question. How much role did she have to play in this decision that was announced this today . Bernanke said that she was consulted on this and agreed with the decision. Februaryind out in whether she is going to continue bernankeng key path path. We will be able to judge for ourselves whether the janet yellen fed believes in this policy. The fed is going to have a difficult year because the economy is not really picking up that quickly. There will still be a lot of concern about the pace of recovery, whether it will accelerate at the pace that the fed is suggesting. It will be years before we know whether ben bernanke left us in a far better place than when he started. That eighty know years after the greenspan era, theys were not as good as appeared when he left. People called in the central banker greatest central banker ever. Those have revised remarks because it left incredible devastation on the United States and the world for years afterward. Benill not know if bernankes decisions were the right decisions. A lot of the callers have brought up this issue about uneven growth, too much of the gains going to the top 1 . Those are accurate criticisms of the structure of our u. S. Economy right now. We have a lot going to the wealthiest people. s policy has benefited those who have plenty of money. You have seen wages and incomes for people who are not in that top tier struggle and in some cases decline over the course not just of this recovery, but for the last 1015 years. We have not seen the kind of sustainable broadbased growth that anyone would want. Those are the metrics by which we should be judging our economy , whether it is benefiting a wide swath of people across the board. It may yet do that. We just dont have a whole lot of evidence yet. We have certainly managed to pull ourselves out of a panic and near collapse. We just have not been able to build a kind of cup recovery we want. Host we will keep taking your calls and comments on Ben Bernankes legacy. We want to point out some of the other headlines. The budget deal that was passed by the senate last night. The headline from the washington times. That story notes that while most House Republicans backed the new budget deal, Senate Republicans balk. It quotes a gop consultant. Republican senators are feeling the heat back home. They know they are on thin ice for cutting backroom deals for the democrats that serve to break promises they made back home. On the nine Senate Republicans who joined democrats to pass the budget deal last night. John mccain,as orrin hatch, chambliss of georgia, isakson of georgia, collins of maine, mccluskey of portmanron johnson, ron rob portman of ohio. We want to point out to you that we mentioned at the top of the segment is the Panel Recommendations on the nsas Data Collection programs. That is the lead story in the new york times. Panel of outside advisers urged president obama to employ major oversights and restrictions on the National Security agency. The most significant recommendations was that mr. Inma restructure a program which the nsa systematically collects logs of all american phone calls and a small group of Agency Officials have the power to authorize the search. You can read more on that story in several of the papers today. Left inabout 15 minutes this segment to talk about Ben Bernankes legacy at the Federal Reserve. Steve from haymarket, virginia. Republican line. Caller the bottom line is that these ridiculous games we have been watching the poor have gotten poorer. Andunions and the tea party two or three other groups need to get together and form a second party. With this budget deal, we now know we have only one party. We have one party rule. It is time for the American People to form a second party. Virginiam haymarket, this morning. Adrian is up next from panama city, florida on the democrat line. Caller good morning. Ont see how mr. Bernanke host go ahead. Im sorry. I dont know how he, the president , or anyone can do anything without have anything coming into the coffers of this country. I think if big business left our country, they keep talking about creating jobs i dont know how they can do that unless the government refurbishes steel with the automobile industry, textiles, all of these things. When you go to the store and you get tomatoes from guat