Sunday, November 21, 2010

Ben Bernanke Speaks Out on Fiscal Stimulus

Is Federal Reserve Chairman Ben Bernanke too late in recommending economic stimulus? Perhaps being attacked by conservatives for quantitative easing has made Bernanke think the risks to the Federal Reserve's independence for making recommendations on fiscal policy are not very high after all. Apparently, monetary policy and the Federal Reserve's independence is now going to be under attack by conservative politicians and monetary policy "experts" such as Sarah Palin regardless of whether Bernanke comments on fiscal policy or not. In any case, there is a precedent for such commentary on fiscal policy, since Alan Greenspan also commented on fiscal policy. Unfortunately, as Paul Krugman laments, such recommendations are probably a little too late. Are Republicans willing to listen to a Republican Federal Reserve Chairman appointed by George W. Bush? Unfortunately, probably not.

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