Bernanke to 2nd term at Fed
President Obama announced this morning at Martha’s Vineyard, that he is nominating Bernanke to a second term.
Obama will interrupt his vacation on the Massachusetts island to make the announcement with Bernanke at his side on Martha’s Vineyard, where the Obama family is vacationing this week.
White House officials said that Mr. Obama had effectively decided four or five weeks ago that he wanted Mr. Bernanke to continue, and that he formally discussed the job with him last week at a meeting with the Fed chairman in the White House.
Federal Reserve Chairman Ben S. Bernanke, led the biggest expansion of the central bank’s power in its 95-year history to battle the worst economic slump since the Great Depression,
Mr. Bernanke has widespread support on Wall Street, too: 42 out of 43 economists surveyed by The Wall Street Journal this month said he should be reappointed, and betting markets give him strong odds of getting a second term.
Mr. Bernanke faces significant criticism on Capitol Hill, which could sway Mr. Obama. Support for Mr. Bernanke isn’t uniform among central-banking insiders, either. Some conference participants criticized Mr. Bernanke for flooding the financial system with too much money, which could cause inflation later.
Others worry he has jeopardized the Fed’s independence by working so closely with the Treasury Department to rescue firms including American International Group Inc. and Bear Stearns.
And European Central Bank President Jean-Claude Trichet took a subtle jab at the Fed Saturday, arguing that inflation expectations and inflation-adjusted interest rates have been more stable in Europe since the crisis started than in the U.S.