Former governor of the Federal Reserve System discusses latest financial crisis

Friday, April 4, 2014 | 9:20 p.m. CDT

COLUMBIA — When Jan Dauve, an MU agricultural economics professor, posed a question about the strength and clarity of communication between the Federal Reserve System and the public, Randy Kroszner likened this relationship to a romantic one. 

"Even though you've been together a long time, misunderstandings come up," Kroszner said. "There's going to be bumps along the way, no matter what."

Kroszner spoke to a packed Hulston Hall on Friday afternoon about the nation's most recent financial crisis. Kroszner served as a governor of the Federal Reserve System from March 2006 to January 2009 and is now professor of economics at the University of Chicago's Booth School of Business. During a 90-minute talk, he shared his thoughts on the primary causes of the financial crisis and possible solutions to the crisis.

The discussion was part of the MU Liberty and Justice Colloquium, which hosts events to inspire discussion about public policy and recent events from different academic perspectives.

Michael Sykuta, an associate professor in the Agricultural and Applied Economics Department, described the discussion as a "fireside chat." During the talk, Kroszner sat across a table from Thom Lambert of MU's Law School. Lambert asked Kroszner several questions about the financial crisis, and then the floor was opened to questions from the audience.

Among the fundamental questions answered, Kroszner addressed what the financial crisis was.

"A key part of it for me is that the whole system of borrowing and lending freezes up," Kroszner said. "The savings process breaks and brings economic activity to a halt."

Supervising editor is Allie Hinga.


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