|
Bush names Bernanke for Fed chief
|
View this Thread in Original format
| St_Andrew |
http://news.bbc.co.uk/2/hi/business/4372562.stm
| quote: | Bush names Bernanke for Fed chief
Current chairman Alan Greenspan's 18-year tenure runs out on 31 January.
Mr Bernanke is currently the government's chief economic advisor after being elected chairman of the Council of Economic Advisers in June.
Mr Bush said the former Fed board member would make an "outstanding" Federal Reserve chief but the decision still needs the backing of the Senate.
If the Senate does back Mr Bernanke's appointment, he will become the 14th chairman of the Fed.
'Continuity'
"If I am confirmed by the Senate I will do everything in my power, in collaboration with by Fed colleagues to help assure the continued prosperity and stability of the American economy," Mr Bernanke said.
"My first priority will be to maintain continuity with the policy and policy strategies under the Greenspan era."
The appointment - which had been widely expected , was welcomed by financial markets.
The Dow Jones index of leading US shares surged 117.7 points higher to 10,333 within minutes of Mr Bush's announcement at the White House.
Credibility
"Bernanke is probably the best qualified ... He is very well known for his inflation targeting and that, I think, is the biggest change that most people see between the two governors," said David Keeble, analyst at Calyon.
Robert Macintosh, chief economist, Eaton Vance Management agreed saying: "He carries a lot of credibility in the marketplace.
"He's well respected in terms of his knowledge and his experience at the Fed. He is seen as a very capable and credible candidate that would prove reassuring in the near term."
But not everyone was pleased.
"He worries me as the next Fed head. He's very tied to what Bush wants too. Having been made the head of the CEA, Bush has gotten to know him, and feels in control," said John Tierney, credit strategist, Deutsche Bank.
Other commentators warned he had little experience outside of the academic realm, which could prove to be a problem.
Different approach
Mr Bernanke, a Princeton University economist, is a leading advocate of "inflation targeting" - an approach widely adopted in Europe. Under the approach central banks set a target for inflation and stick to it.
However, Mr Greenspan believes central banks should keep markets guessing on how tough they would be on inflation.
Most market observers agreed that Mr Greenspan's would be a hard act to follow.
"It's hard to imagine anybody having the backbone that Greenspan brought to the job, the ability to withstand months and months of criticism and stick to his guns," said FTN Financial chief economist Chris Low.
During his time at the Fed Mr Greenspan has steadied markets during financial crises, endorsed budget and tax reform, and led the fight against inflation. |
Good/Bad?
Obviously Greenspan is a tough one to replace, but you think this is the right pick? Or did Bush pick him to get someone to "help him in his agenda"? I seriously have no clue about this guy so ppl with more knowledge please enlighten me ;) |
|
|
| occrider |
| Well, he has better credentials than that dumb whore of a lapdog Miers. |
|
|
| Shakka |
Bernanke was widely believed to be the next guy to get the nod. I think it was essentially between him and Kohn.
If memory serves, Bernanke is not as hawkish on inflation as Greenspan, and therefore might be less likely to prick the housing bubble or invert the yield curve. However, only time will tell, but at least he is regarded as a very capable future Fed Chairman (at least at this point!) |
|
|
|
|
