Ben Bernanke: new Fed chair

Let me add my enthusiastic endorsement of the choice of Ben Bernanke to replace Alan Greenspan for chair of the Federal Reserve Board to the positive support earlier expressed at Marginal Revolution, the Big Picture, New Economist, Economist’s View, and Angry Bear.

Ben Bernanke
bernanke.jpg

I have developed tremendous respect for Bernanke over the years. His academic work on the role of Federal Reserve policy in the Great Depression has been central in shaping the modern consensus. His work on measuring the contributions to postwar economic fluctuations of what the Fed does has likewise proven central for much of the macroeconomic research on this topic over the last twenty years. I have taught using both his macroeconomic textbook, which does an unusually nice job of integrating the determinants of saving and investment decisions into macroeconomic analysis, as well as his principles textbook, which does a superb job of communicating the essence of how markets work in a variety of settings.

He absolutely has a first-rate mind, just as sharp as they come. And he’ll need all the gray matter that can be mustered in his new job, I fear, to figure out how to respond to simultaneous threats of recession, inflation, global imbalances, and systemic financial risk.

I’ve disagreed with Bernanke on a number of specific issues over the years. Some of those arguments I admit that he won, and some I still view as unresolved. I certainly reserve the pundit’s prerogative to start criticizing whatever he does with monetary policy the day he takes charge, nay, even before he assumes the office, I shall feel free to kvetch. But I will be doing so from a position of respect for the new office holder.


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16 thoughts on “Ben Bernanke: new Fed chair

  1. The Glittering Eye

    Bernanke named as new Fed chairman

    Contrary to widespread conjecture President Bush did not appoint his accountant to be the new Chairman of the Federal Reserve. He appointed Ben Bernanke:
    WASHINGTON (AP) – President Bush on Monday selected Ben Bernanke, chairman of the president&#8…

  2. William J. Polley

    Bush taps Bernanke for Fed Chairman (Econoblog alert!)

    A number of economist bloggers were asked by the Wall Street Journal for comment on the Bernanke selection. You can read all of our comments at the WSJ Econoblog page. NY Times story here. More to follow. UPDATE: Greg Ip…

  3. PrestoPundit

    I OPPOSE THE NOMINATION OF BEN BERNANKE

    as Chairman of the Federal Reserve. Bernanke’s economically illiterate view on deflation have made him perhaps the leading inflationist of our time — and disqualify him for such a position on the Federal Reserve.
    Didn’t want to dilly-dally on th…

  4. Barkley Rosser

    PrestoPundit is way off. If there is a problem with Bernanke, besides his lack of market experience, it is that he is too clearly wedded to inflation targeting rather than a Taylor rule approach or the discretionary one of Greenspan, which has worked pretty well. Of course, Bernanke has promised to be more transparent and to follow the tradition of Greenspan. Given that he will be the new Chair and there are both governors and a bunch of Fed Bank presidents who have been working with Greenspan for a long time, it is likely that he will not insist on an absolute adherence to this, even if they do announce some target.
    Clearly Bernanke is superior for various reasons to the most frequently mentioned other leading candidates, Hubbard, Feldstein, and Lindsey. Of course The Economist backed Kohn, but clearly the markets wanted Bernanke, and after other recent appointment fiascos it is clear that Bush wanted to play it safe on this one. Wise idea.

  5. New Economist

    Bernanke round-up

    Plenty of media and blog coverage today of Ben Bernanke’s appointment as the next Fed Chairman. My previous posts covered the initial blog commentary, but see also Tyler Cowen’s piece on Bernanke’s contributions as an economist, and William Polley and …

  6. Movie Guy

    I am hoping that Ben Bernanke will update his “gloval savings glut” presentation by shifting some focus to global investment (FDI and domestic) flows which are concentrating tightly on the lowest cost white collar and blue collar production sources and concurrent large scales of production.
    That is what is happening. Less total investment, smaller overhead, and fewer supporting services and related expenses are involved.

  7. Full Disclosure

    Will he or won’t he?

    The blogosphere is crackling with speculation about how Ben Bernanke will address inflation concerns when he takes over as Fed chairman. Overall, economic blogs are bullish on Bennanke’s selection, as James Hamilton points out. Marginal Revolution has …

  8. molley nunziata

    Good afternoon My dear audience and Mr.Ben bernanke March 7,2006..
    I wish to congratulate Mr.Ben bernanke of assuming his position as the new feds chief…I belief he is a very good man..especially since I will be able to forcast exactly what he will be doing after MArch 28,2006..
    Forcast…March 21,2006 Officially spring
    March 29,2006 Officially increase short term rates by 1/4%.
    June 21,2006 Officially Summer.
    July 4,2006 Officially independence day July 5,2006 No more increase interest rates for the next 10 years..
    July 5,2006 No more increase interest rates in long term interest rates..
    July 5,2006 Inflation rates 5%..
    Congratulation Mr.Ben Bernanke for doing such a wonderful job..

  9. arnold frasewood

    Mr.Ben bernanke MArch 15,2006 12;33pm
    Good afternoon Mr.Ben bernanke.I take this opportunity to really thank you from the bottom of my heart for leaving those long term interest rates at the level of december 31,2005..
    I am one of those few who really can read the between the lines when ever you speak..and I personally wish you lots of luck on your new employment..What ever you do,use any excuse,but leave those long term rates,where they are today
    or prior…That is all I ask for you for the next five years…The reast you can imagine for your self..Keep up the good work you are doing for the feds office..I really honestly appreciate you..

  10. carolina herdoff

    MArch 15,2006 1;10pm
    Hi Mr.BEn bernanke and the wonderful audience.
    The congress and the senate of the u.s. have chosen as head of the feds office a wonderful individual namely Mr.Ben bernanke..Congratulations. I certainly hope as
    a token of appreciation to sending you my good wishes to you my dear Mr.Bernanke,you will
    leave those long term interest rates at the level
    of the dates you will read my comments of this website..I really appreciate to write my comments on this website…

  11. william jack bentley

    Inflation in the u.s.a. MArch 17,2006 9;44am
    The news which was released about inflation on MArch 16,2006 in the u.s.a.is irrelevant to real inflation..Yes those are figures to test the new employee of the feds office,namely A Mr.Ben Bernanke.But even though it might sound good to the press it is far from the truth..
    will continue my comment shortly,as there seems to be a blackout…

  12. william jack bentley

    continued from last comments.MArch 17,2006..
    Those inflation figures as reported in the previous comments was test the new feds employee
    Mr.Ben bernanke when he has to issue the new interest rates at the MArch 28,2006 meeting
    and to make it harder for him to challange the situation he is being forced to challange..
    The true figure might be release sometime long after MArch 28,2006 so to prove to him that
    his career as the new feds chief and the imformation supplied to him is totally baseless.
    If you take a look just over the last past year,
    many employment figures,trade figures,ect….were reported on the set date,however,if one follows ,the press release the following month or two,one will notice that many of those figure were
    reported incorrectly and changed when the new figures were release the following month.
    Unfortunately,Those in charge are in plain languauge,purposely reporting incorrect figures
    so as to test either the feds office or other personal in various department..If these comment were ever released to the press,boy it will make news,much more than one will find in any newspaper
    printed in the u.s.a. today.
    with these remarks, I certainly hope that from hereon when ever the new feds office will use
    the inflation picture to set the guidelines
    for interest rates,He will include the doubling of real estate from the year 2001 to the year 2005.

  13. kevin james knowington

    MArch 22,2006 Mr.Ben bernanke
    I heard you speak on MArch 20,2006
    and from your whole speech,I do understand you are very happy where the long term interest
    rates are…I tell you the truth,I am making a bundly of money very easy these days as I am renewing all those long term mortgages which are
    expiring next week and for the next several month..I do belief that eventually ,your office will find out what amny of us are doing and
    I truly belief by that time it will be a little to late for your action..I really feel sorry
    for those who have to purchase homes today,as
    I see the situation changing if your feds office beliefs it or not…At that time,if you read these comment or not,those who do,will be very happy that I have forwarn what actually will happen in the long term interest rates market..

  14. donald klampen

    march 28,2006 Attention MR.BEn bernanke..
    2;11pm
    congratulation Mr.Ben bernaqnke on your new career..
    You are the best for the feds office..wishing you long life and lots of luck with very little
    literature education on my behalf

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