Archive for January 2008
Remarks by Greg Ip to the Money Marketeers of New York University, Jan. 16, 2008
Ben Bernanke delivered a forceful speech in Washington last week suggesting the Fed was going to be quite a bit more aggressive about easing monetary policy. It made quite an impression on a lot of people. J.P. Morgan’s report was called: “The Chairman takes charge.” Lyle Gramley’s report was titled: “Bernanke stands tall.”
These broker notes reflected the suspicion that before that speech, Bernanke had been something of a shrinking violet, letting his lesser ranked officials overpower his message and sway his policy. He was too academic, dwelling on the ins and outs of liquidity policy and inflation expectations when what the U.S. wanted was lower interest rates, yesterday.
Interestingly many of these qualities were being praised when he was nominated in 2005. Bush had been perceived as putting loyalty above qualifications and installing polarizing outsiders to run institutions like the CIA and the World Bank. He drew sighs of relief when the man named to run the Fed was someone with a reputation for being collegial, nonpartisan, of great technical ability, and with no record of partisanship. Far from sharing the administration’s penchant for secrecy, Bernanke was a longstanding advocate of more openness. Read the rest of this entry »