Today Bush announced that Ben Bernanke will take over for Alan Greenspan as Chairman of the Board of Governors for the Federal Reserve, which is a major announcement, considering the fact that Alan Greenspan is the equivalent of an economics "rock star" (which I know is a oxymoron) and the fact that Greenspan has led the Federal Reserve since before some of my students were born (August 11, 1987).
We will talk much more about the role of the Federal Reserve chairman and Ben Bernanke next semester when we get to Macroeconomics, but for now here is a link to various economists talking about how this is a good nomination, and here is link to a summary of Bernanke's major contributions to macroeconomics.
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A couple of comments:
- by saying Greenspan is an economics "rock star," it is more a reference to his fame, not necessarily his talents (although his talents are hard to doubt as well)
- Bernanke is actually known for an idea called "inflation-targeting," where the Fed explicitly aims for a particulat inflation rate. This gives me confidence in Bernanke's ability to keep inflation down & the fact that he does not want more inflation.
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