Historical Newspapers of South Carolina

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Fed nominee says he would stay course laid by retiring chairman Greenspan ITIartin Crutsinger THE ASSOCIATED PRESS WASHINGTON — Ben Bernanke, President Bush’s choice to be the next chairman of the Federal Reserve, is making it perfectly clear that his top priority would be to continue Alan Greenspan’s legacy — a comment that is music to investors’ ears. The stock market soared, with the Dow Jones industrial average enjoying its best one day performance in six months, climbing by 170 points, after Bush announced on Monday his nomination of Bernanke, the president’s top economic adviser. Bernanke, 51, is expected to win easy Senate confirmation although some Democrats said they planned to quiz him on his ability to protect the independence or me reo. In a brief White House ceremony, both Bush and Bernanke praised Greenspan, 79, who will step down at the end of January after having served 18 years and five months as Fed chairman, longer than anyone except another Fed legend, William McChesney Martin, who was first appointed by Harry Truman and served for 18 years and nine months. Bush praised Greenspan, who attended the ceremony, for keeping inflation low and economic growth strong while Bernanke said Greenspan had shown the world the best way to run monetary policy. “If I’m confirmed to this position, my first priority will be to maintain continuity with the policies and policy strategies established during the Greenspan years,” said Bernanke, who was viewed as one of the country’s leading experts on central bank operations during his tenure as an economics professor at Princeton University. Bush tapped Bernanke in 2002 to serve on the Fed board. Since June he has been chairman of Bushs Council of Economic Advisers. Greenspan called Bush’s decision a “distinguished appointment” and said that Bernanke would bring to the chairmanship “superb academic credentials and important insights into the way our economy functions.” Private analysts said they did not expect any major changes in the way monetary policy is handled under Bernanke, who never dissented from the Greenspan-led decisions on interest rates during his nearly three years at the Fed. They also saw the appointment or oernanKe as way for the White House to quell some of the furor over Bush’s Supreme Court nomination of White House counsel Harriet Miers, who has been attacked by conservatives as unqualified. “Bernanke may be the perfect counterpoint to the Harriet Miers selection,” said David Jones, chief economist at DMJ Advisors, a Colorado consulting firm. Sen. Richard Shelby, R-Ala., chairman of the Senate Banking Committee, said he hoped his committee could vote on the Bernanke nomination before Thanksgiving and the full Senate could act before leaving town for the year. That would ensure that Bernanke could take over on Feb. 1, the day after Greenspan’s board term ends. Bernanke won praise from both Republican and Democratic senators although Democrats said they planned to question him closely to ascertain whether he will be able to maintain the Fed’s independence given his service in the Bush administration. Some Democrats said they also would question Bernanke over one of the few areas where he disagreed with Greenspan. Bernanke believes the Fed should establish a target or range for inflation so that the public would have a better idea of the Fed’s goals. Greenspan rejected this approach, saying it could tie policy-makers’ hands. Democrats are worried that establishing a fixed target for inflation push the Fed to slight its other legal mandate to pursue policies that maximize employment. J. Scon Applewhite / The Associated Tress President Bush names his top economic adviser, Ben Bernanke, right, to become the new chairman of the Federal Reserve Board, replacing the near-legendary Alan Greenspan, left, in the Oval Office at the White House in Washington on Monday. Greenspan, who became chairman in 1987, completes his current term on Jan. 31,2006. H;ould be the next editor EGAMECOCK NEWSPAPER. lb' m JH W6dR8$d3y* Novcnibcx 9,2005 WmMIMkm^m*± ,--s