USA: Obama keeps Bernanke at Fed

Record ID: 498326

  • Title: USA: Obama keeps Bernanke at Fed
  • Date: 26th August 2009
  • Summary: JACKSON HOLE, WYOMING (AUGUST 21, 2009) (REUTERS) BERNANKE WALKING INSIDE TO CONFERENCE HALL BERNANKE WALKING WITH OTHERS OUTSIDE CONFERENCE
  • Embargoed: 10th September 2009 13:00
  • Keywords:
  • Location: Usa
  • Country: USA
  • Topics: Economic News,Domestic Politics
  • Reuters ID: LVAD62TZUKX3E6ABKQSON5Y76KRR
  • Story Text: U.S. President Barack Obama renominates Ben Bernanke for a second term as chairman of the U.S. Federal Reserve.
    U.S. President Barack Obama interrupted his week-long vacation on Martha's Vineyard to announce that he was nominating Ben Bernanke to a second term as Federal Reserve chairman.
    "Ben approached a financial system on the verge of collapse with calm and wisdom; with bold action and outside-the-box thinking that has helped put the brakes on our economic freefall," said President Obama.
    President Obama is counting on Bernanke to nurse the U.S. economy back to health at a time when unemployment, home foreclosures and bank failures are still mounting.
    "I will work to the utmost of my abilities--with my colleagues at the Federal Reserve and alongside the Congress and the Administration--to help provide a solid foundation for growth and prosperity in an environment of price stability," said Federal Reserve Chairman Ben Bernanke.
    The nod from Obama is seen as a tacit endorsement of the unprecedented steps Bernanke took during the height of last year's financial crisis, including adding a trillion dollars of troubled assets to the Fed's balance sheet.
    While Bernanke's renomination wasn't a surprise, the timing of the announcement was.
    "I do think there were loud voices coming, said Mark Calabria, an economist with the Cato Institute. "I think there's been very strong support from Wall Street for his reappointment and I think that played an influence in the President finally making the choice to reappoint him."
    In fact, U.S. financial markets -- which see Bernanke as a known entity who designed an aggressive financial rescue plan, reacted positively to the news-- which came on the same day the White House and the non-partisan Congressional Budget Office both forecast that the national debt could nearly double over the next 10 years.
    Bernanke has his share of critics. Some lawmakers from both major US parties contend he should have recognized housing and credit bubbles earlier this decade. But Bernanke is expected to be confirmed by the full Senate when it comes back from recess in September.
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