Fed chairman talks to Obama about job

Bernanke is said to be exhausted

Federal Reserve Chairman Ben Bernanke appears on a television screen on the floor of the New York Stock Exchange on Wednesday during a news conference after the Fed’s two-day meeting.
Federal Reserve Chairman Ben Bernanke appears on a television screen on the floor of the New York Stock Exchange on Wednesday during a news conference after the Fed’s two-day meeting.

Federal Reserve Chairman Ben Bernanke said he’s “spoken to the president a bit” about his future and that he feels no personal responsibility to stay at the helm until the Fed winds down its unprecedented policies to stimulate the economy.

“I don’t think that I’m the only person in the world who can manage the exit,” Bernanke said when asked at a news conference in Washington if he’s discussed his plans with President Barack Obama. His term expires at the end of January.

Bernanke’s comments meshed with the views of some of Obama’s economic and political advisers who said Bernanke, 59, after spending most of his seven years on the job battling a financial crisis and its aftermath, is exhausted and wants to return to private life. The current and former administration officials asked to not be identified to describe the private conversations.

Michelle Smith, a Fed spokesman, declined to comment. Amy Brundage, a White House spokesman, didn’t respond to a request for comment.

Bernanke’s remarks Wednesday were a departure from his previous statements that he hasn’t discussed his plans with Obama or White House officials.

On Dec. 12, during his last news conference, Bernanke said that he hadn’t “had any conversations” with the president or anyone on his team about his potential departure.

“I think the president has got quite a few issues he needs to be thinking about, from the fiscal cliff to many other appointments and so on,” he said then, when asked if he would serve a third term.

Since his December remarks, Bernanke has had several meetings with Timothy Geithner, when he was still Treasury secretary, including one with the president. Geithner left that meeting early, giving Obama and the Federal Reserve chairman some private time, according to a person familiar with the meeting.

On Wednesday, Bernanke said, “I’ve spoken to the president a bit, but I really don’t have any, I don’t really have any information for you at this juncture.”

Bernanke, a former Princeton University professor, also said he didn’t feel personally responsible to lead the Fed when it unwinds its balance sheet.

Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, disagreed with Bernanke’s statement, saying he has an obligation to stay.

“His knowledge and experience is too valuable to let him go,” Rupkey said.

Bernanke, a student of the Great Depression, took steps unprecedented in the Fed’s 100-year history to steer the economy through its worst crisis since the 1930s.

He used the Fed’s balance sheet to rescue Bear Stearns Cos. and American International Group Inc. from collapse, while supporting corporations and small businesses with innovative lending programs that kept credit flowing as banks struggled under rising amounts of home-loan delinquencies.

He cut the benchmark lending rate to zero in December 2008 to energize the economy and then continued to provide stimulus with outright bond purchases, expanding the Fed’s total assets to a record $3.17 trillion. Wednesday, Bernanke said the Fed would maintain its $85 billion in monthly asset purchases and keep its key rate near zero.

Bernanke said that one of the things he hoped to accomplish and was “not entirely successful at, as the governor or as the chairman of the Federal Reserve, was to try to depersonalize to some extent monetary policy and financial policy and to get broader recognition of the fact that this is an extraordinary institution.”

“It has a large number of very high-quality policymakers, it has a terrific staff, literally dozens of Ph.D. economists who’ve been working through the crisis, trying to understand these issues and implement our policy tools,” Bernanke said. “And there’s no single person who is essential to that.”

Business, Pages 27 on 03/22/2013

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