Bernanke’s fate is up in the air
Federal Reserve Chairman Ben S. Bernanke’s confirmation to a second four-year term, seemingly a slam dunk just a few weeks ago, now has become a true battle royal.
Although Democratic Sens. Dianne Feinstein of California and Max Baucus of Montana voiced support for Bernanke on Monday, a Wall Street Journal tally showed that the Fed chief still was 20 votes shy of the 60 needed to overcome a filibuster that could block his confirmation. A total of 43 senators have said they are undecided or haven’t officially commented.
Bernanke’s term expires Sunday. Even if he were to lose the chairmanship he would remain on the Fed board unless he decided to walk away altogether: His term as a board member expires in 2020.
President Obama again endorsed Bernanke in an interview with ABC News on Monday. “He has my strongest support,” Obama said. “What we need is somebody at the Federal Reserve who can make sure that the progress that we’ve made in stabilizing the economy continues. And I think Bernanke is the best person for that job.”
Some senators may want to see whether Bernanke’s image takes another hit at a House hearing Wednesday on the Fed’s 2008 bailout of American International Group Inc. The hearing will focus in part on whether the Fed tried to hide details of the bailout.
Bernanke won’t be testifying, but Treasury Secretary Timothy F. Geithner will. Geithner was head of the Federal Reserve Bank of New York at the time of the AIG bailout.
The hearing “could turn into a referendum on [Bernanke] ahead of the vote,” Wall Street advisory firm Strategas Research Partners told clients in a note Monday.
Major stock indexes posted moderate gains Monday after falling Friday on doubts about Bernanke’s confirmation.
