When Bernanke's term ends in January, will Obama replace him or keep him?
Although I think it would be better to keep him on, since he is a known quantity in these turbulent financial times, I think Obama will find it very difficult not to put his own stamp on a power position he has a chance to appoint. Since the federal reserve chairman has a term of 4 years, appointed by the president, and subject to Senate confirmation, Obama may not get another chance to make this change. (Although he is sure he will serve a second term at this point.)
If you recall, President Bush brought Bernanke in to serve as his chairman of his Council of Economic Advisors for awhile before deciding on him to replace Alan Greenspan. Bernanke was a governor of the Federal Reserve at the time. Obama's council has no FRB governors on it.
http://www.whitehouse.gov/administration/eop/cea/members/
The president must choose from sitting governors of the Fed. That limits his choice to the following list. Donald L. Kohn, the current vice chairman, Kevin M. Warsh, Elizabeth A Duke, and Daniel K. Tarullo. Although Bernanke would no longer be the Chairman, he would still have the rest of his 14-year term as a governor to serve. So he would still be there in the woodwork.
http://www.federalreserve.gov/aboutthefed/default.htm
Daniel K. Tarullo is the ringer on this board of governors. He took office on January 28, 2009. He is a law professor from Georgetown. He held several senior positions in the Clinton administration. Before that, he served on the staff of Senator Edward Kennedy and practiced law in Washington, DC. He also taught at Harvard Law School and was a visiting professor at Princeton. Not any experience as a central banker. He is Obama's man. But surely not, you say.
Time will tell.
