BIG BEN DESCENDS THE MOUNTAIN WITH NEW GOSPEL?

WHILE Wall Street headed to the Hamptons for this final weekend of summer, Fed chief Ben Bernanke headed for the hills – quite literally, the stunning Rocky Mountain peaks of Jackson Hole, Wyo.

You remember Jackson Hole? The remote annual meeting place for the most important of central bankers. The place where just five short years ago Alan Greenspan reflected on the dot-com bubble that had just burst with spectacular impact.

“We at the Federal Reserve have considered a number of issues related to asset bubbles,” the then-Fed chief observed in 2002. “We recognized that, despite our suspicions, it was very difficult to identify a bubble until after the fact – that is when its bursting confirmed its existence.”

Well, now it is “after the fact” again, although it is hard to believe that even the myopic maestro didn’t see this housing bubble busting. But in the summer of 2007 it is Greenspan’s Fed successor, Bernanke, who is left to clean up the mess. And what a mess it is. Indeed, the credit tsunami of ’07 is so vast and so complex, no one can really seem to quantify it, much less contain it.

It’s been painful to watch Bernanke of late. Hamlet-like, he’s tried to navigate the subprime terrain. Clearly the former Princeton professor is trying to make a clean break from the Greenspan tradition of never finding a crisis that didn’t deserve a rate cut. And with no textbook to guide him, Bernanke surely has had the toughest job in Washington this summer.

While Big Ben went out of his way on Friday to warn that: “It is not the responsibility of the Federal Reserve . . . to protect lenders and investors from the consequences of their financial decisions,” he basically threw in the beach towel by admitting that when those bad, risky decisions start to impact the overall economy, the Fed may have to act by cutting rates.

Yep, Bernanke helped ring out the month of August by giving America’s risk-takers (the hedge funds, the private-equity shops and the real estate speculators) the all-clear signal they’d been clamoring for all summer. Rates will fall along with the autumn leaves. Bernanke blinked, and for that reason alone stocks actually finished the angst-filled month of August in positive territory.

When he was a high school senior, Bernanke earned the highest SAT score in his home state of South Carolina. But you don’t have to be smarter than a 5th grader to realize that following on the heels of a Fed chairman who grew the debt punch bowl to record proportions – even trying to take a little fun out of the party is now nearly impossible.

TERRY KEENANis anchor of Cashin’ In, an investing program that appears on Fox News Channel on Saturday mornings at 11:30. E-mail terry.keenan@foxnews.com.