Bernanke Begins Second Term as Fed Chairman

Posted Feb 4th 2010 11:00AM by Joseph Lazzaro
Filed under: International Markets, Federal Reserve, Financial Crisis

The late, great writer David Halberstam, who left this world far too soon, once said that a writer's life was the loneliest job in the world.

Perhaps the Chairman of the U.S. Federal Reserve is the second loneliest job in the world.

Fed Chairman Ben Bernanke was sworn in for his second four-year term Wednesday, the Fed announced.

And with it Bernanke ventured into his second term -- his initial term having taken place as first the United States, then the world, became ensnarled in the financial crisis that deepened the global recession -- the world's first contraction since the end of World War II.

Bernanke has been rightfully criticized for not recognizing the subprime default/securitization toxic asset risk sooner, but he deserves even more credit for successfully navigating the U.S. financial system through its greatest crisis since the Great Depression.

Dozens of high-responsibility decisions he made took place under severe time constraints, and under large amounts of pressure. Decisions literally involving hundreds of billions of dollars had to be made within hours.

History, systemic stability, and U.S. economic performance will be the ultimate judges of Bernanke's decisions, but as a result of his ability, in conjunction with efforts by companion central banks in Europe and Japan and other policy makers, to avert what looked like a financial disaster, Bernanke's initial grade is high.

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

Tags: Bernanke, inthenews