The extension of Ben Bernankes term as Federal Reserve chairman shouldnt have come as much of a surprise, except to those who were hoping for better management of the economy.
But despite the mantra of change in an oh-so-recent presidential campaign, the new Fed boss is the same as the old boss. True, the economy is showing some hopeful signs of a turnaround, at least on Wall Street. Main Street is another matter, however. The unemployment numbers are looking as dismal as ever, even if the job losses arent falling off the cliff at quite so fast a rate as a few months ago.
The White House and the Congressional Budget Office now both predict the recession will end within a few months. The budget deficit may be looking a little better than the disastrous picture projected not too long ago, though its still going to zoom to nearly $1.6 trillion, triple the amount of last years deficit.
Bernankes reappointment does provide some reassurance that the Fed chairman will continue with the policies the administration has been pushing in recent months, so we dont have to worry about a profound disagreement emerging and throwing the economic turnaround into reverse. Plus, the Fed chairman is at least a familiar face on Capitol Hill, beard and all.
Still, some members of Congress are ready to grill Bernanke once again over his handling of the economy, past and present. Christopher Dodd, D-Conn., chairman of the Senate Banking Committee, reportedly said that the Bernanke reselection was probably the right choice, but he still intends to question the Fed chairman about the central banks response to the mortgage crisis and where Bernanke stands on the Feds role in the regulatory overhaul plans that the White House has sent Congresss way.
Continuity seems to be the rule of late, at the SEC as well as the Fed. SEC Chair Mary Schapiro has just removed the acting part of acting chief accountant James Kroekers title, meaning that he gets to play the part for real now. While many outside observers would agree that both the Fed and the SEC could use a good overhaul, Kroeker has at least demonstrated that he has faith in accountants, defending fair value accounting standards in the mark-to-market study he helped produce for the SEC, and during the infamous hearing in which Congress demanded that FASB chairman Robert Herz revise mark-to-market accounting standards forthwith. Kroeker too will carry on tradition, having been deputized by his predecessor and former boss, Conrad Hewitt.
Kroeker, like Bernanke, has experience with being on the hot seat, and proving to be a steady hand through a very difficult period. They will need to continue wearing their flak jackets because its not going to be an easy ride.
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