Will heat from the Hill influence Bernanke?

(Presumably, these representatives and senators also believe that government coercion is the reason those same banks lent hundreds of billions of dollars to commercial real estate companies and realty management firms for excess malls, shopping centers, and office complexes that are going bankrupt at a pretty good rate. That's it -- the poor caused the mortgage default crisis: that's why mortgages to malls are going bad! Right.)

In any event, the mood on Capitol Hill is to 'more-closely monitor' the U.S. Federal Reserve. One misguided, ill-conceived bill would even have the General Accountability Office (GAO) audit the Fed.

Now, the compelling question is, 'does or will the current anti-Fed mood on Capitol Hill affect the Fed's monetary policy?' The answer is it probably will, but not any more than the typical, business cycle pressure the Fed experiences.

The Fed is independent -- and should remain so -- but it does not operate in a political vacuum. In light of the current climate on the Hill, the Fed may keep short-term interest rates lower for a longer period of time than it would when the political climate was benign; the political climate's impact on the unprecedented and complex quantitative easing policy is less certain. Frankly, undoubtedly few lawmakers thoroughly understand the function of quantitative easing, so it's hard to gauge their response to it.

However, overarching all of the above will be the U.S. unemployment rate: weak job creation and a linger high unemployment rate will feed the anti-Fed faction. Robust job creation and a steadily-declining unemployment rate will melt that faction faster than Dorothy melted the Wicked Witch.

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Financial Editor Joseph Lazzaro is writing a book on the U.S. presidency and the U.S. economy.