Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
One of the popular theories on the internets (sic) is that Bernanke wants to goose the market to help get Obama re-elected since he wants to keep his job. That due to the comments continuously heard during the GOP primaries about how every candidate wanted to replace Bernanke. There is a piece in the WSJ overnight by Fed mole Jon Hilsenrath and while it is more dovish (by a degree) than his comments just 24 hours ago on CNBC (maybes someone at the Fed yelled at him), which has a very interesting blurb on this topic:
Mindful of his own legacy and the Fed’s independence, Chairman Ben Bernanke seems unlikely to allow the political calendar to sway his decisions. He appears especially immune from politics now, with just 18 months left in his term as chairman and little indication that he wants another.
Now if the U.S. is at a weak moment economically at the end of Bernanke’s term, and Obama is re-elected maybe Bernanke will be asked to carry on, but unlike a Treasury Secretary which might stay on an extra year while an economy is in a weak spot, once Ben commits he commits for many years. So I found this paragraph very interesting in light of the commentary about Bernanke wanting to retain his job. It would seen doubtful a President Romeny would come in and remove someone who at that time would only have 12 months left in his Fed chairman role. Especially if that someone did not want a new term.
That said, if Romney wins it seems to kill the chances for the heir apparent Janet Yellen if indeed Ben wants out. Yellen makes Bernanke look like a hawk. Anyhow, thought I’d pass it along as it was news to me.
p.s. The last angle of course is someone who has no aspirations past 18 months certainly carries a lot more freedom in his/her actions than someone who does!
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