 Recorded Books presents 21st Century Monetary Policy, the Federal Reserve from the Great Inflation to COVID-19 by Ben S. Bernanke, narrated by me, George Waddell. Introduction On January 29, 2020, Jay Powell strode briskly to the podium to begin the first press conference of his third year as chair of the Federal Reserve. He flipped open a white binder, looked up briefly to welcome the assembled reporters, and then looked down to read his prepared statement. His demeanor was low-key, almost somber, but his message was upbeat. The U.S. economy had entered the eleventh year of a record-long expansion. Unemployment remained at a half-century low, and people in lower-paying jobs were seeing wage gains after years of stagnation. The trade tensions that had roiled financial markets for the past two years had diminished and global growth seemed to be stabilizing. In passing, he noted uncertainties affecting the economic outlook, quote, including those posed by the new coronavirus, end of quote. A follow-up question on the virus from Donna Borak of CNN did not come until twenty-one minutes into the fifty-four-minute press conference. At that point, only a few cases had been reported outside China. The virus, Powell cautiously acknowledged, was a very serious issue that could cause some disruption to activity in China and possibly globally. Five weeks later, on March 3, Powell walked to the same podium, and in the same calm tone read a much darker statement to reporters. He offered his sympathy to people the virus had harmed around the world, noted that it had disrupted the economies of many countries, and predicted that measures to contain the virus will surely weigh on economic activity both here and abroad for some time. The Fed, he said, was cutting interest rates to help the economy keep strong in the face of new risks. He hinted at more to come. The state of the world had changed dramatically, and the Fed's policy had changed with it. In the January 29 and March 3 press conferences, the virus had evolved from a localized problem to an incipient global crisis. Reported cases of the disease that would become known as COVID-19 had risen from fewer than 10,000, almost all in China, to more than 90,000 worldwide. Italy had quarantined towns in its Lombardi region, and Iran had reported a surge of infections. In the United States, the first virus death was reported on February 29, a man in its fifties near Seattle. U.S. cases and deaths grew exponentially, from there threatening to overwhelm health care systems in New York City and other hotspots. Meanwhile, virus fears triggered the worst week in U.S. financial markets since the 2007-2009 financial crisis, signaling trouble ahead for the economy. The Dow Jones industrial average, which had hit a record high earlier in the month, plunged more than 12 percent during the week ending February 28. In March, the turmoil spread to bond markets. Sellers of even ultra-safe U.S. Treasury securities had difficulty funding buyers, who showed little interest in holding anything other than cash. The markets for private credit were corporations, home buyers, and state and local governments borrow threatened to freeze entirely as lenders and investors grappled with coronavirus-induced uncertainty. The market's panic attack did, in fact, presage economic trauma. With businesses and schools closing, either voluntarily or under lockdowns imposed by local governments, economic activity contracted at an unprecedented rate. In February 2020, following a long recovery from the Great Recession, only 3.5 percent of the labor force was unemployed. Two months later in April, the official unemployment rate stood at 14.8 percent, a shocking increase that likely understated the damage to the labor market. More than 20 million jobs were lost in April, by far the largest drop recorded since the data series began in 1939. The Business Cycle Dating Committee of the National Bureau of Economic Research, the Arbiter of the Timing of Recessions and Expansions, were later date the start of the pandemic recession to February. Having served as Fed Chair during the 2007-2009 global financial crisis, I had some idea of the stress that Powell and his colleagues at the Fed were experiencing. But unlike the crisis we faced a dozen years earlier, which played out over nearly two years, this one seemed to happen all at once. On the principle that it's better to get ahead of a crisis when you can, the Powell Fed quickly took a remarkable range of actions to Sample complete. Ready to continue?