The Right Man at the Right Time

Ben Bernanke will most likely be seen as one of the seminal figures of the 21st century, the man who literally saved us from another Great Depression.

Ben Bernanke
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However, these policies have also more than tripled the Federal Reserve's balance sheet and Bernanke has faced more dissension among his own ranks than any previous Fed chairman, with at least one dissenting vote cast at more than half of the Federal Open Market Committee meetings that he has presided over. To quote renowned economist Milton Freidman, inflation is almost everywhere a monetary phenomena. Without an appropriate exit strategy rising prices will be a severe problem that could jeopardize the economic recovery and unravel all that Bernanke has worked so hard to accomplish. 

In recent speeches and policy statements Bernanke has suggested that the time to taper off may come sooner than later, but should he exit at the beginning of next year, this task will certainly fall on his successor. Fed Vice Chair Janet Yellen would provide the most continuity to Bernanke's philosophy on monetary policy and she would have an easier time with Senate confirmation. Although Lawrence Summers is likely to weigh inflation risks more heavily, he is viewed as a controversial choice due to his actions as Treasury Secretary and may bring uncertainty to financial markets and the economy. 

[See a collection of political cartoons on the budget and deficit.]

Regardless of whoever the next Fed chairman will be, they, like Bernanke before them, will certainly have supersized shoes to fill. While it is clear that the final verdict on his legacy may not be written for months or years after his departure, 50 years from now, Ben Bernanke will most likely be seen as one of the seminal figures of the 21st century, the man who literally saved us from another Great Depression.

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