Who Is Ben Bernanke........replacement for Greenspan?

[Dover]

Ben Shalom Bernanke (born December 13, 1953) is the Chairman of the U.S. President's Council of Economic Advisers (CEA) and the nominee to succeed Alan Greenspan as Chairman of the Board of Governors of the United States Federal Reserve. He was previously a member of the Board of Governors of the Federal Reserve, serving from August 2002 until just prior to his June 2005 swearing-in as CEA chairman.

Born in Augusta, Georgia, he graduated from high school in Dillon, South Carolina in 1971; from Harvard University (summa cum laude) in 1975; and earned his Ph.D. at the Massachusetts Institute of Technology in 1979. He taught at Stanford University from 1979 until 1985, and has since then been a professor in the Department of Economics at Princeton University. He has chaired that department since 1996. He has given several important lectures at the London School of Economics on monetary theory and policy and written three textbooks on macroeconomics.

He was the Director of the Monetary Economics Program of the National Bureau of Economic Research and the editor of the American Economic Review.

He is known for his work on the transmission channels of monetary policy, particularly a 1992 paper with Alan Blinder arguing that expansion of credit was more important than the money supply. His work on the transmission of monetary policy also gave rise to an interest in the causes of the Great Depression, a period in U.S. history accompanied by substantial monetary deflation.

He gave a speech in 2002 entitled "Deflation: Making Sure 'It' Doesn't Happen Here" in which he discussed possible Fed actions to prevent deflation saying, "A money-financed tax cut is essentially equivalent to Milton Friedman's famous 'helicopter drop' of money". Further describing several options in the government's arsenal for fighting deflation Bernanke also said, "the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost."

In March 2005, a few months prior to becoming Chairman of the CEA, he gave a speech which argued that international economical factors were largely responsible for the American current account deficit. This was controversial among those economists who felt the deficit was due to governmental spending and tax cuts by the Bush administration. <1>

On October 24, 2005, President Bush nominated Bernanke to succeed Alan Greenspan as Chairman of the Federal Reserve. Greenspan will retire on January 31, 2006 after 18 years as chairman.

Bernanke is widely regarded to be a proponent of the Fed adopting an explicit inflation target, as other central banks do. <2>...cont'd

http://en.wikipedia.org/wiki/Ben_Bernanke

Family:

http://marriage.about.com/od/politics/index.htm

2003 Financial disclosure:

http://www.kintera.org/atf/cf/{DFBB2772-F5C5-4DFE-B310-D82A61944339}/BB03.pdf
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August 11, 2005, 9:24 a.m.
The Scary Side of Ben Bernanke
Bush should look elsewhere when Greenspan steps down.

By John Tamny

Last Friday’s Wall Street Journal reported that Larry Lindsey has been added to President Bush’s short list of potential replacements for Alan Greenspan at the Federal Reserve. Martin Feldstein, Glenn Hubbard, and Ben Bernanke are the other three most prominently mentioned, with Bernanke the frontrunner on Tradesports.com.

Bernanke recently weighed in with his opinions on the economy in the Journal, and while he lauded tax cuts, free trade, and legal reform, a supply-sider he is not. His views on how tax cuts impact the economy, his odd interest in demand charts, and not to mention his discredited beliefs about “limits” to growth and “full” employment, should have Bush supporters concerned.

About taxes, Bernanke spoke of “fiscal stimulus” that has diminished “in the past few quarters.” Bernanke is clearly in the Keynesian camp on taxes, holding that they should be reduced during times of slack demand and increased when economic growth reaches its natural “limits.” While Keynesians see tax cuts through a demand-driven, short-term stimulus prism in which their impact gradually recedes, supply-siders encourage marginal rate cuts for their long-term (and continuous) incentive effects on economic activity. The distinction between the two schools of thought is crucial, particularly given the growing influence of the Fed on Capitol Hill...cont'd


http://www.nationalreview.com/nrof_comment/tamny200508110924.asp

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June 28, 2005
Ben Bernanke Holds the Fort Alone
I didn't know that Kristen Forbes had left the CEA:
Council of Economic Advisers: Ben S. Bernanke is Chairman of the Council of Economic Advisers (CEA). Two positions on the council are currently vacant. The CEA was established by the Employment Act of 1946 to provide the President with objective economic analysis and advice on the development and implementation of a wide range of domestic and international economic policy issues. The CEA includes three members who are appointed by the President, by and with the advice and consent of the Senate. The President shall designate one of the members as Chairman...

No news as to successors to her, or to Harvey Rosen

http://delong.typepad.com/sdj/2005/06/ben_bernanke_ho.html



Aug. 09, 2005
Ben Bernanke Goes to Crawford
Ben Bernanke reports on what he said to Bush. He apparently failed to stress two important things:

Bush administration fiscal policy is way out of balance in the long run, and this is a very serious problem: if the government doesn't balance its budget (in the sense of keeping real debt growing no faster than real GDP), then the market will balance the budget for it in ways that nobody will like.

Bush administration international economic policy is way out of balance as well: the administration should be doing much more than it is doing--i.e., nothing--to try to minimize the size of the financial crisis should foreigners suddenly decide to dump their dollar assets on a large scale.
These are two things that George W. Bush and his inner circle need to hear as often as possible. And I'm scared that nobody is telling them....cont'd

http://delong.typepad.com/sdj/2005/08/ben_bernanke_go.html

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Helicopter Money, Or The Road To Weimar?

by Marshall Auerback
November 26, 2002

...Recent statements by the Chairman of the Federal Reserve, Alan Greenspan, and a prominent Federal Reserve governor, Ben S. Bernanke, suggest that we are at last in the final stages of this process. Speeches by both gentlemen kindly spell out exactly the sort of explicit and transparent rationale required to engender the final moral hazard melt-up in the capital markets. Be careful what you wish for: Deflation may be averted, but if we are to take the proposals sketched out by these Fed officials at face value, the increasingly extreme outcome that lies in store for the US economy may be one of two equally unpalatable scenarios: a degree of socialisation unheard of since the days of the old Soviet Union or a Weimar Germany-type hyperinflation.
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Also attended the 2004 Bilderberg meeting.

http://news.bbc.co.uk/1/hi/magazine/3773019.stm

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Seems to have some expertise on the Great Depression. That ought to come in handy!

http://www.pupress.princeton.edu/titles/6817.html

Remarks by Governor Ben S. Bernanke
At the H. Parker Willis Lecture in Economic Policy, Washington and Lee University, Lexington, Virginia
March 2, 2004
Money, Gold, and the Great Depression

I am pleased to be able to present the H. Parker Willis Lecture in Economic Policy here at Washington and Lee University. As you may know, Willis was an important figure in the early history of my current employer, the Federal Reserve System. While he was a professor at Washington and Lee, Willis advised Senator Carter Glass of Virginia, one of the key legislators involved in the founding of the Federal Reserve. Willis also served on the National Monetary Commission, which recommended the creation of the Federal Reserve, and he went on to become the research director at the Federal Reserve from 1918 to 1922. At the Federal Reserve, Willis pushed for the development of new and better economic statistics, facing the resistance of those who took the view that too many facts only confuse the issue. Willis was also the first editor of the Federal Reserve Bulletin, the official publication of the Fed, which in Willis's time as well as today provides a wealth of economic statistics. As an illustration of the intellectual atmosphere in Washington at the time he served, Willis reported that when the first copy of the Bulletin was presented to the Secretary of the Treasury, the esteemed Secretary replied, "This Government ain't going into the newspaper business."

Like Parker Willis, I was a professor myself before coming to the Federal Reserve Board. One topic of particular interest to me as a researcher was the performance of the Federal Reserve in its early days, particularly the part played by the young U.S. central bank in the Great Depression of the 1930s.1 In honor of Willis's important contribution to the design and creation of the Federal Reserve, I will speak today about the role of the Federal Reserve and of monetary factors more generally in the origin and propagation of the Great Depression. Let me offer two caveats before I begin: First, as I mentioned, H. Parker Willis resigned from the Fed in 1922, to take a post at Columbia University; thus, he is not implicated in any of the mistakes that the Federal Reserve made in the late 1920s and early 1930s. Second, the views I will express today are my own and are not necessarily those of my colleagues in the Federal Reserve System.

The number of people with personal memory of the Great Depression is fast shrinking with the years, and to most of us the Depression is conveyed by grainy, black-and-white images of men in hats and long coats standing in bread lines. However, although the Depression was long ago--October this year will mark the seventy-fifth anniversary of the famous 1929 stock market crash--its influence is still very much with us. In particular, the experience of the Depression helped forge a consensus that the government bears the important responsibility of trying to stabilize the economy and the financial system, as well as of assisting people affected by economic downturns. Dozens of our most important government agencies and programs, ranging from social security (to assist the elderly and disabled) to federal deposit insurance (to eliminate banking panics) to the Securities and Exchange Commission (to regulate financial activities) were created in the 1930s, each a legacy of the Depression....cont'd

http://www.federalreserve.gov/boarddocs/speeches/2004/200403022/default.htm

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Fed. Reserve Board Speech:

Remarks by Governor Ben S. Bernanke
Before the National Economists Club, Washington, D.C.
November 21, 2002
Deflation: Making Sure "It" Doesn't Happen Here

Since World War II, inflation--the apparently inexorable rise in the prices of goods and services--has been the bane of central bankers. Economists of various stripes have argued that inflation is the inevitable result of (pick your favorite) the abandonment of metallic monetary standards, a lack of fiscal discipline, shocks to the price of oil and other commodities, struggles over the distribution of income, excessive money creation, self-confirming inflation expectations, an "inflation bias" in the policies of central banks, and still others. Despite widespread "inflation pessimism," however, during the 1980s and 1990s most industrial-country central banks were able to cage, if not entirely tame, the inflation dragon. Although a number of factors converged to make this happy outcome possible, an essential element was the heightened understanding by central bankers and, equally as important, by political leaders and the public at large of the very high costs of allowing the economy to stray too far from price stability.

With inflation rates now quite low in the United States, however, some have expressed concern that we may soon face a new problem--the danger of deflation, or falling prices. That this concern is not purely hypothetical is brought home to us whenever we read newspaper reports about Japan, where what seems to be a relatively moderate deflation--a decline in consumer prices of about 1 percent per year--has been associated with years of painfully slow growth, rising joblessness, and apparently intractable financial problems in the banking and corporate sectors. While it is difficult to sort out cause from effect, the consensus view is that deflation has been an important negative factor in the Japanese slump.

So, is deflation a threat to the economic health of the United States? Not to leave you in suspense, I believe that the chance of significant deflation in the United States in the foreseeable future is extremely small, for two principal reasons. The first is the resilience and structural stability of the U.S. economy itself. Over the years, the U.S. economy has shown a remarkable ability to absorb shocks of all kinds, to recover, and to continue to grow. Flexible and efficient markets for labor and capital, an entrepreneurial tradition, and a general willingness to tolerate and even embrace technological and economic change all contribute to this resiliency. A particularly important protective factor in the current environment is the strength of our financial system: Despite the adverse shocks of the past year, our banking system remains healthy and well-regulated, and firm and household balance sheets are for the most part in good shape. Also helpful is that inflation has recently been not only low but quite stable, with one result being that inflation expectations seem well anchored. For example, according to the University of Michigan survey that underlies the index of consumer sentiment, the median expected rate of inflation during the next five to ten years among those interviewed was 2.9 percent in October 2002, as compared with 2.7 percent a year earlier and 3.0 percent two years earlier--a stable record indeed. ..cont'd

http://www.federalreserve.gov/boarddocs/speeches/2002/20021121/

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Remarks by Governor Ben S. Bernanke
At the Sandridge Lecture, Virginia Association of Economics, Richmond, Virginia
Governor Bernanke presented similar remarks with updated data at the Homer Jones Lecture, St. Louis, Missouri, on April 14, 2005.

March 10, 2005
The Global Saving Glut and the U.S. Current Account Deficit



On most dimensions the U.S. economy appears to be performing well. Output growth has returned to healthy levels, the labor market is firming, and inflation appears to be well controlled. However, one aspect of U.S. economic performance still evokes concern among economists and policymakers: the nation's large and growing current account deficit. In the first three quarters of 2004, the U.S. external deficit stood at $635 billion at an annual rate, or about 5-1/2 percent of the U.S. gross domestic product (GDP). Corresponding to that deficit, U.S. citizens, businesses, and governments on net had to raise $635 billion on international capital markets.1 The current account deficit has been on a steep upward trajectory in recent years, rising from a relatively modest $120 billion (1.5 percent of GDP) in 1996 to $414 billion (4.2 percent of GDP) in 2000 on its way to its current level. Most forecasters expect the nation's current account imbalance to decline slowly at best, implying a continued need for foreign credit and a concomitant decline in the U.S. net foreign asset position.

Why is the United States, with the world's largest economy, borrowing heavily on international capital markets--rather than lending, as would seem more natural? What implications do the U.S. current account deficit and our consequent reliance on foreign credit have for economic performance in the United States and in our trading partners? What policies, if any, should be used to address this situation? In my remarks today I will offer some tentative answers to these questions. My answers will be somewhat unconventional in that I will take issue with the common view that the recent deterioration in the U.S. current account primarily reflects economic policies and other economic developments within the United States itself. Although domestic developments have certainly played a role, I will argue that a satisfying explanation of the recent upward climb of the U.S. current account deficit requires a global perspective that more fully takes into account events outside the United States. To be more specific, I will argue that over the past decade a combination of diverse forces has created a significant increase in the global supply of saving--a global saving glut--which helps to explain both the increase in the U.S. current account deficit and the relatively low level of long-term real interest rates in the world today. The prospect of dramatic increases in the ratio of retirees to workers in a number of major industrial economies is one important reason for the high level of global saving. However, as I will discuss, a particularly interesting aspect of the global saving glut has been a remarkable reversal in the flows of credit to developing and emerging-market economies, a shift that has transformed those economies from borrowers on international capital markets to large net lenders....cont'd

http://www.federalreserve.gov/boarddocs/speeches/2005/200503102/default.htm

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Thursday, October 21, 2004
Ben Bernanke
Speaking at Dalton College in Albany, Georgia, Federal Reserve Governor Ben Bernanke said the "days of cheap oil are likely over," although he expects the economic consequences of higher energy prices will be "manageable." Bernanke also said he believes the Fed will be able to maintain its "measured" pace of rate hikes, in part because inflationary expectations remain low. To sum it up, get use to higher oil prices and interest rates. No wonder why the market is having a tough go at the moment.

http://www.thekirkreport.com/2004/10/ben_bernanke.html

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October 18, 2005

Ben Bernanke Inflation Fighter
by Mike Shedlock


Some ideas are just too stupid to not comment on. Hyping $Ben Bernanke as an inflation fighter is one of those ideas. It's not just one person who lost his mind either. Both Tom Schlesinger, executive director of the Financial Markets Center, and Mark Zandi Economy.com chief economist have simultaneously gone off the deep end in proposing that "Helicopter Drop" Bernanke is an "inflation fighter". That absurd idea was proposed in a CNN Money article about who will replace Greenspan as next FED chairman entitled Favorites pull ahead in Fed derby. Let's take a look:

http://www.safehaven.com/showarticle.cfm?id=3964&pv=1


March 12, 2005

Is Ben Bernanke The "Reincarnation" Of Manley Johnson?
by Paul Kasriel


Do you remember Manley Johnson? He was a Fed governor from February 7, 1986 to August 3, 1990. Johnson was the "leader of the pack" of FOMC members - all of whom were governors - who advocated that monetary policy decisions be guided by the behavior of "auction-market" indicators. Auction-market indicators is just fancy terminology for prices of goods and financial instruments determined in relatively free markets. (For two excellent books on auction-market indicators - well, one excellent book anyway, see Monetary Policy, A Market Price Approach, by Manuel H. Johnson and Robert E. Keleher, and Seven Indicators That Move Markets, by Paul Kasriel and Keith Schap.) One of these auction-market indicators that Johnson placed a lot of faith in was the behavior of the shape of the yield curve. A steepening in the yield curve was a signal that monetary policy might be getting more accommodative. A flattening in the yield curve was a signal that monetary policy might be getting more restrictive.

What does all this have to do with current Fed Governor Bernanke? On Tuesday, March 8, in a speech in Chicago, Bernanke made the following comments:

The funds rate will have reached an appropriate and sustainable level when, first, the outlook is consistent with the Committee's economic goals and, second, the slope of the term structure of interest rates is approximately normal, as best as can be determined. With this definition in mind, one can search for indications of where the "neutral" funds rate is likely to be at a given point in time...cont'd


http://www.safehaven.com/article-2731.htm

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BOOKS he authored
Complete NBER (Nat. Bureau of Economic Research) Listing

http://www.princeton.edu/~bernanke/nber.htm
http://www.nber.org/cgi-bin/author_papers.pl?author=ben_bernanke

Macroeconomics:
http://mitpress.mit.edu/catalog/item/default.asp?ttype=2&tid=6009
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[pnorman]

1. This is well outside of any "expertize" I may possess.

But it's at least as important as many other topics on our minds. I'm nominating this for "GREATEST".

pnorman

[Mass]

2. Thanks for all this info - I will read that with interest

Nominated.

[orwell]

3. Thanks...

...for the wrap up. Unfortunately, for many of us who are quite openly disgusted by the Federal Reserve and the havoc it has wreaked within the US economic structure since its inception, Bernanke represents more of the same in a long line of Fed governors whose primary mission is to "grease the wheels" of the "consumer" engines of capitalism, not oversee the soundness of either the currency or the banking system as oft stated.

Within 20 years of the borderline illegal inception of the Federal Reserve at Jekyll Island in 1910 (Yeah...you can't make this stuff up), the destruction of the buying power of the dollar began, with its unreported and largely unseen wealth transfer from low income workers to the elite workers (asset holders) at the top of the "food chain." Those who benefit the most from inflation are those who hold the real assets. I'll let you guess who they are.

The only comfort in the Bernanke choice is that he will be accepted by the markets, which is critical when your entire economic system is largely based on a con job. And so we go on, whistling past the graveyard, convinced that our "noble capitalist endeavor" is the greatest in the world—when the very capital it is based on flows from a spigot controlled by the chosen few.

Free markets indeed...

[highplainsdem]

4. Thanks for this info! I'm adding a link to the LBN thread about him:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1873194

[barbaraann]

5. All you have to know is that he's a monetarist.

He's not a friend of ordinary people.

http://en.wikipedia.org/wiki/Monetarism

[applegrove]

6. It looks like he may be into fighting inflation by sharing the pain with

the rich. That is a good thing. I mean - why should the middle class and poor be doing all the heavy lifting (loosing jobs and having to find new ones that pay less) - while the rich have a roaring market?

It looks like this puppy may actually share the costs of good times across the board with mild recessions designed to fight inflation and not subsidize the parts of the economy that are a drag (i.e. big oil).

Don't know..

[Dover]

7. Bernanke at Davos, Switzerland

Correction to my initial post above: Bernanke did NOT (to my knowledge) attend the 2004 Bilderberg meeting. It was the Davos Meeting:

Speeches, Testimony, Papers

What Have We Learned from the Euro at Five?
Ben S. Bernanke
The Federal Reserve

Remarks made at "Euro at Five: Ready for a Global Role"
Institute for International Economics
Washington, DC
February 26, 2004

http://www.iie.com/research/researcharea.cfm?ResearchTopicID=8

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Paul Volcker to Speak at Economic Summit
2005-02-04 09:00:00.0 CDT

Economists and Policy Makers Gather at Economic Summit SOX on Agenda


Paul Vocker
Past Chairman of the Federal Reserve
Economists from around the globe will gather on Friday, February 11, 2005 to review and analyze three of the top economic issues of the year at the Stanford Institute for Economic Policy Research (SIEPR) Economic Summit. The day-long event will conclude with a speech given by Paul Volcker. Cisco Systems and Lehman Brothers are sponsoring the event.

John Shoven, SIEPR director and Social Security expert will present Douglas Holtz-Eakin, Director, of the Congressional Budget Office (CBO) who will discuss a number of economic issues relevant to the Presidential budget.

On the same stage will be Anne Krueger, First Deputy Managing Director, International Monetary Fund (IMF) and John Taylor, Undersecretary for International Affairs, Department of the Treasury who will look at the stability of the global economy.

George Shultz and William Perry will discuss how we view terrorism. Both are former Cabinet Secretary's who had to deal with these issues.

Ben Bernanke, a member of the Board of Governors of the Federal Reserve System will give the lunch talk. Immediately following, John Lipsky, Chief Economist for J.P. Morgan Chase & Co. and Janet Yellen, President of the SF Federal Reserve Bank will discuss the economic outlook for the United States. ..cont'd

http://www.s-ox.com/news/detail.cfm?articleID=515

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Jan 28, 2003


Global: The Asymmetries of Globalization

http://www.morganstanley.com/GEFdata/digests/20030128-tue.html