Sunday, November 29, 2009

In Orwellian op-ed, Bernanke says regulating the Fed will damage the Fed-ruined economy

NEW YORK (CNNMoney.com) -- Federal Reserve Chairman Ben Bernanke, just days ahead of his confirmation hearing, is warning Congress that actions limiting the central bank's independence could prove detrimental to the causes of financial reform and economic recovery.

In an op-ed piece to be published in Sunday's Washington Post, Bernanke criticizes two moves aimed at limiting the Fed -- a proposal in the Senate to strip the central bank of its bank regulatory powers and a House Financial Services Committee vote to audit monetary policy deliberations and actions.

"These measures are very much out of step with the global consensus on the appropriate role of central banks, and they would seriously impair the prospects for economic and financial stability in the United States," Bernanke wrote...

Bernanke's column comes ahead of a Senate Banking Committee hearing, scheduled for Thursday, considering his nomination for a second term as Fed chairman. President Obama announced the nomination in August.

The last sentence of his commentary is likely to be the theme he and his supporters will stress during the hearing.

"Now more than ever, America needs a strong, nonpolitical and independent central bank with the tools to promote financial stability and to help steer our economy to recovery without inflation," Bernanke wrote

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