World Economic Forum Participants Support Bernanke
On Thursday the US senate voted to reconfirm Ben Bernanke despite fierce opposition. Bernanke faced the stiffest opposition since the confirmation of Paul Volcker in 1083. At the World Economic Forum taking place in Davos Switzerland Bernanke has many supporters. John Mack the chairman of Morgan Stanley said of Bernanke; “Ben got us through—along with a team of others—we got through a big crisis… And I’m sure there are people that would say if he was really doing his job that wouldn’t have happened. You and I both know that’s bogus. He has been in that role for a short period of time so I don’t think we’d have panic but I do think it would hurt the markets — we saw the markets sell off about 5% last week but I think the markets are feeling somewhat better because there is support and it looks like he will be voted in.”
Former President Clinton Supports Bernanke Confirmation
Former US President Bill Clinton also expressed support for Bernanke. About Bernanke’s nomination by Obama Clinton said; I will say this: I think he is right to reappoint Mr. Bernanke, for two reasons. One is that I think since this crisis occurred in September of 2008, Bernanke’s decisions have been very good, they have kept the American economy going and given us a chance to heal. Secondly, he said something that is very important to say, that the crisis occurred because regulation in the past had been too lax.” Clinton also said that Bernanke deserved the nomination because of his guidance through the worst financial crisis since World War Two.
Tight Senate Vote
The Senate voted 70 to 30 to confirm the former Princeton professor and Bernanke faced the stiffest opposition since the legislative body started confirming Fed chairmen in 1978. Bernanke faces opposition from many Republicans. Senators who supported Bernanke cited the strategies Bernanke used to address the worst recession in decades. Senator Carl Levin, a Michigan Democrat stated; “Chairman Bernanke’s performance in addressing the economic crisis and his current efforts to significantly enhance financial regulation to help prevent future crises outweigh his past mistakes.”
Exit Strategy Biggest Challenge
Many believe Bernanke’s biggest challenge will be devising an exit strategy to dismantle the various emergency measures the Fed took to address the crisis. The Fed’s low interest rates are seen as dollar negative in currency markets and investors have speculated for months when the Fed will raise rates. Despite the speculation about rates the Fed said last Wednesday that it would keep rates “exceptionally low” for “an extended period.”
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