Republican presidential candidate Mitt Romney has gone on record as saying he is opposed to Federal Reserve Chairman Ben Bernanke's economic stimulus plans as "ineffective and inflationary," and has vowed to appoint a new Fed Chair, if he is elected, The New York Times reported today.
In its latest attempt to boost the economy, the Federal Reserve announced in September that it will buy back $40 billion a month from banks in mortgage backed securities, for an undisclosed time.
Articles in today's Business Insider and Reuters speculate about the possibility of a Federal Reserve without Bernanke, should Romney become the 45th President of the U.S.
First, even if President Obama is re-elected it is likely that Bernanke would have only held the job until the end of his term in 2014. According to Reuters, "Fed watchers have long assumed that Ben Bernanke didn't want a third term..."
Of course, changes in the Fed would depend largely on Romney's choice for a Bernanke replacement.
The Times and Business Insider ran down a list of likely suspects including two of Romney's economic advisors: John Taylor, a monetary policy expert and vocal critic of the Fed's policies, who is, "seen as an inflation hawk who would put the Fed on a more predictable policy path," and R. Glenn Hubbard, Chairman of the Council of Economic Advisors under George W. Bush,"viewed by some as the most likely Romney pick to replace Bernanke." Hubbard is also critical of quantitative easing.
Another possibility is Harvard economist Greg Mankiw, "seen as the dove in the group," according to Business Insider. "He has embraced the idea -- one with growing popularity on the left and right -- that the Fed should target a nominal GDP path, even if that means sometimes allowing inflation to rise about 2% for a period of time."
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