Bernanke named as new Fed chairman

by Dave Schuler on October 24, 2005

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’s Council of Economic Advisers, to replace Alan Greenspan as Fed chairman, according to an administration official.

The official spoke on condition of anonymity because the nomination had not yet been announced. Bush was to announce his choice at 1 p.m. EDT, said White House spokesman Scott McClellan.

Greenspan, who took over in August, 1987, wraps up his term as chairman Jan. 31. Asked about Greenspan’s successor, Bush said, “We’ll be making an announcement soon.”

McClellan, while not identifying Bush’s choice, said the individual he had selected was “someone who is highly qualified and someone who is well respected.”

Bernanke, 51, is a former member of the Fed board. He also was a professor at Princeton University and chairman of the economics department.

Bernanke and Greenspan differ on whether the Fed should set targets for inflation – Bernanke thinks it should, Greenspan does not – but otherwise they share a similar philosophy. In fact, while he was at the Fed, market observers would often look at Bernanke’s speeches for insight into Greenspan’s thinking.

I look forward to econbloggers’ commentary on the appointment. Let the games begin! I’ll post updates here as they become available.

UPDATES:

Outside the Beltway has a good backgrounder and links on Bernanke.

Brad DeLong: “A very good choice”.

Bryan Caplan of EconLog (who was a student of Bernanke’s): “he’s about the best that libertarians could reasonably hope for”.

Mark Thoma of Economists’s View believes it’s a strong nomination that will be viewed favorably both by Wall Street and academics.

Ezra Klein is amazed.

Noah Millman of Gideon’s Blog thinks that, as a “sober, smart centrist”, Bernanke is a good call.

Tyler Cowen of Marginal Revolution has a pair of posts on the appointment. In the first post he calls Bernanke “an excellent choice and a first-rate economist”. The second is a substantive post on Bernanke, his work, and his contributions to economics. Read this (and its links) and you’ll have the basis for making an informed judgement.

James Hamilton of Econbrowser is enthusiastic about the nomination.

Max Sawicky of MaxSpeak offers some support for the nomination:

He is well-qualified, and he has managed to sail through his brief tenure in the Bush Administration with minimal resort to demagogy, in contrast to predecessor Glenn Hubbard

Nouriel Roubini is pleased with the nomination.

hilzoy of Obsidian Wings thinks we owe the Bernanke nomination to the troubles with the Miers nomination.

Steve Verdon has comments of his own at Outside the Beltway and repeats some of the links I’ve got here.

Barry Ritholtz of The Big Picture characterizes Bernanke as “a safe, strong choice”.

Andrew Samwick of Vox Baby is pleased with the nomination.

{ 2 comments… read them below or add one }

Frances M. October 25, 2005 at 7:44 am

Many thanks for posting this, I’ve linked to it here:
http://goodbloggin.blogspot.com/2005/10/princeton-prof-bernanke-chosen-to.html

Kris Kibak June 6, 2006 at 1:26 am

Great post, very useful collection of opinions. Thanks!

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