Zeev's Turnips Patch-No Politics (ZEEV)

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DOOMED: Bush Picks Helicopter Ben- UFB!!

Bush Picks Bernanke As New Fed Chairman
Monday October 24, 12:13 pm ET
By Nedra Pickler, Associated Press Writer
Bush Selects Bernanke to Replace Greenspan As New Fed Chairman, Official Says
http://biz.yahoo.com/ap/051024/bush_fed.html?.v=16

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. An announcement was expected at 1 p.m. EDT.

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."

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.

There had been widespread speculation that Bush might act as early as this month to give the Senate time to act on the nomination before Greenspan's term expired.

However, announcing Greenspan's successor also provided a diversion for a White House reeling under congressional criticism of the Harriet Miers' Supreme Court nomination and a federal investigation into whether top officials leaked the name of a CIA operative for political purposes.

Bernanke has a reputation as a straight-talking economist and a Republican who avoids telegraphing any ideology.

In June 2005, Bernanke was sworn in as chairman of the President's Council of Economic Advisers. He had served as a member of the board of governors of the Fed since August 2002,

A summa cum laude graduate of Harvard University in 1975, he received his doctorate from the Massachusetts Institute of Technology in 1979. During his years in Boston, he focused on the economic underpinnings of the Great Depression and the losing track record of the city's beloved baseball team, the Red Sox.

"Economics is a very difficult subject," Bernanke once said. "I've compared it to trying to learn how to repair a car when the engine is running."

At the Fed, Bernanke has pushed for the central bank to be more specific in its inflation objectives. Greenspan has opposed setting a numerical target for inflation.

Bernanke also has championed openness at the Fed -- a policy that Greenspan has advanced prominently.

Greenspan was 61 when he first took over the demanding job as Fed chairman.

His first government service was as chairman of the president's Council of Economic Advisers during the Ford administration. He had originally been tapped for that post by Richard Nixon, who resigned before Greenspan took office.

He joined the government after a long stint running Townsend-Greenspan, a New York consulting firm which had as its clients some of the country's top corporations.

It was during this period that he gained a reputation as an economist who loved to delve into the minutia of economic data, from monthly box car loadings to steel production data to try to determine the future direction of the economy.

He pursued his Fed job in the same way, often calling economists at other agencies to discuss the fine points of the government statistics. He would rise early every morning for a two-hour soak in his bathtub, time he used to devour the latest government statistics and Fed staff memos on the economy.

Greenspan succeeded another Fed legend, Paul Volcker, who during his eight years at the Fed had pushed interest rates up to their highest level since the Civil War in a successful effort to break a decade-long bout of inflation but also pushed the country into the deep 181-82 recession.

Greenspan never had to resort to pushing interest rates so high, mainly because during his tenure inflation never soared to the double-digit rates that Volcker confronted.

The economy did suffer two recessions during Greenspan's long tenure at the Fed, a 1990-91 downturn that occurred in part because of a huge spike in oil prices following Iraq's invasion of Kuwait, and a 2001 downturn that was worsened by the deadly terrorist attacks on the World Trade Center and the Pentagon.

The appointment is subject to Senate confirmation.

It was under Greenspan that the central bank began in 1996 for the first time to announce on the day of its meeting whether it had made any changes to the short-term interest rates the Fed controls.

While technically Greenspan only had one vote on the 12-member Federal Open Market Committee, the Fed chairman was exceptionally adept at building consensus among the Fed board members and regional bank presidents who make up the panel that meets eight times a year to set interest rates.

He also demonstrated a keen mastery of Washington's political power games. His long tenure at the Fed was due in no small part to his ability to get along with whoever occupied the White House.

A life-long conservative Republican, Greenspan was first selected as Fed chairman by Ronald Reagan in 1987. He was re-nominated by the senior George Bush, also a Republican, and won two more selections for four-year terms by Bill Clinton.

Die Hard Bears Agree- Ben was the WORST CHOICE POSSIBLE

equity market ramp; happy about ben
Bulldog NEW 10/24/2005 11:18:33 AM

It's hilarious that the ushering in of ben is being taken as oh soooooo bullish. Yea, soylent groin has been oh so tight with the money supply reins. soylent groin has pushed the debt supply to the highest sustainable levels, and then some. Right to the point where we are hyperinflating. Of course there is no inflation according to the govt. LOL. Can credit be obtained any easier? I suppose in interest rates are pushed to Japanese levels. But the marginal benefit is largely gone. And, what is the fed gonna do? Spawn more bubbles? It's hard to say. One thing is certain, the viability of the dollar is going to come into question. Either they continue to tighten of the dollar is toast. If the dollar is toast, then the high cost of energy is going to grind the country to a halt. If the dollar isn't toast, then higher rates will grind the country to a halt. Nice choice soylent green. There are no aces in the whole left. There is no way to accelerate demand any further. They already allowed real estate to be massively overbuilt. So what are we going to rely on now for jobs? Manufacturing? Then we are subject to massive deflationary pressure on wages. To wit: look at Delphi; GM & Ford. Tariffs? Oh yea, that will be a hit. No matter who is the futures fed chairman, the US economy is screwed. It's going to be similar to Japan. We will likely see 15 years of declining real estate values. Stagflation, deflation or depression - take your pick. Credit contraction is going to take its toll. The Sword of Damocles is ready to fall.