NY Fed Prez Blasts Compensation of Bailed-Out Bankers

The president of the New York Federal Reserve Bank says he finds it "deeply offensive" that some of the very same individuals and banks that helped bring about the financial crisis are benefiting from the government and the Fed's response to the crisis. WNYC's Lisa Chow reports.

REPORTER: Bill Dudley spoke last night at Columbia University, to a crowd of mostly students and professors. He said the public outrage was understandable.

DUDLEY: If there was some way we had the tools to save the financial system and not save the bankers, that would have been a better way to go I think. but we didn't have that choice. the choice that faced us was either financial Armageddon or saving the financial system.

REPORTER: To prevent such a choice in the future, the former Goldman Sachs economist said the Fed and other regulators need to step in and prevent housing and financial asset bubbles from developing in the first place, or deflate them in ways that don't wreck the economy. For WNYC, I'm Lisa Chow.