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It was breaking in just the last half hour the Wall Street Journal reporting that the White House is preparing its list of potential suitors to replace Federal Reserve Chairman Ben Bernanke joining us now.
John hills and -- Wall Street Journal chief economics correspondent.
Hoping give us an idea who's on the short list you know done.
-- gotta keep reporting that one out on the here's what we do you know -- we do you know that it looks like this process is gonna last into the fall.
And dissolve fluid could change but we get the sense that in the early fall -- when.
They think they could be making a decision they need to give the -- time to hold hearings and do their own due diligence.
And then we we also know that is this what what we're hearing is that this is an open competition you know there's been a lot of talk.
About Janet -- being the front runner for this job but what we're hearing is they've got an open mind they don't they have not established a front runner that everyone has to be out.
Now we don't know who is on the list but I think we have a pretty good sense of who what idiotic Janet Yellen is -- she's the Fed's number two.
The vice chairwoman.
And she used to work in the -- -- economic advisors for Clinton.
Larry Summers is another name we keep hearing.
-- he was a former Treasury Secretary you -- for for Clinton he was Obama's -- of their National Economic Council.
And there aren't a lot of other names out there Roger Ferguson and who worked at the Fed Alan Blinder who is -- the Fed Donald -- Stanley Fischer Christina drummer.
-- that the list is at this point is you know we're talking.
Several other quite a number of people and then the bit wild card is Bernanke.
It you know we think Bernanke wants to go Obama seemed to acknowledge that Bernanke wants to -- but there's always a chance especially.
The markets get really unsettled in the next few months that Obama could try to convince -- look.
-- let me ask about that because the president either misspoke.
Or spoke it in and kind of got a surprisingly harsh manner about Bernanke when he said that -- what was his exact -- city.
He stayed longer.
Than he thought it would and perhaps longer than the shorter something -- to -- -- though he was dissing Bernanke a little bit was -- -- misspeak or did he mean.
I think the president put his foot in his mouth on that one and is -- and the White House in our story is very quick to put out a statement saying that they're very happy with the job that Bernanke's done.
You know he's tried to push -- easy money policies to get the economy going I think what the president was trying to say is that listen.
It looks like the guy wants to leave and we ought to just let him leave when -- when his term comes up in January.
Didn't tried to back pedal away from this impression that they're trying to kick him out.
And I frankly -- I don't think they are trying to kick him out what I think that he really just wants to go.
Let's talk about what's happening this week is speaking of miss speaking a lot of people say that what we have seen this week is an attempt.
To counteract that the -- speak up Bernanke on -- that he was gonna pull back.
-- come from gunning the gas on on monetary policy.
Does this Bernanke thinks that he misspoke.
Earlier in in suggesting that they were gonna pull out -- -- markets wanted to I.
I think Bernanke and all this colleagues don't think that they misspoke I think that they think that the markets didn't get the message.
You know my analogy here and it's cut alike.
The markets are from Mars and the -- is from Venus they keep talking past each other.
-- the Fed you know Bernanke I -- said pretty clearly at his press conference a week ago that the Fed is not going to be raising.
Short term interest rates until 4015.
And but what we saw the markets is people pricing in quicker interest rate increases.
There's a lot of moving parts -- what the Fed is saying is they think they can pull back on their bond buying program -- At some point later this year and is very conditional if what -- economy picks up I understand -- shot or getting mixed up about all.
I think is is that we did see interest rates really demonstrates going up I mean a ten year interest rates that's not a figment of some -- guys imagination those are -- -- stuff that people really deal with.
And it went up surprisingly.
That my question is whether the Fed is thinking maybe they've lost control of huge interest rates the way to -- This is where -- fed is from Venus in the markets are from Mars I think.
The markets misread the Fed but the Fed and this is actually kind of troubling news -- the markets I think what -- -- didn't see.
Is that long term interest rates were coiled like a spring.
They were push so low.
By the Fed's policies that even like a hint that the Fed might pull back on some of these things in the spring pop back up I think that's what we saw on the last week.
You know the Fed has been talking about short term interest rates the markets and living long term interest rates.
The fact is both sides talked package -- but it looks today.
In the last couple days like things have settled down a bit the Dow is -- back up over 151000.
-- ten year treasury -- -- back under two and a half percent it looks like they've kind of reach some equilibrium on all the you know I don't think they've lost control.
One thing that is clear over this past week is that if there was any doubt.
That the Fed was directly.
Trying to influence Wall Street movement of Wall Street I can't imagine.
Back in the days would Paul -- you'll remember this but I do have when Paul Volcker.
Was trying to get rid of inflation he was jacking up interest rates Wall Street was screaming they were dying.
And he wasn't listening that's not Ben Bernanke.
Well yeah I mean you know so that green's gone back to Greenspan there's -- been all this talk about the Greenspan put in the Bernanke put.
You know I think the one thing that you could say a you know in -- -- Bernanke is he's had a different set of problems that Welker had you know Volker had to squeeze Wall Street to squeeze inflation out of the system.
You know right now we have 1% inflation the Bernanke is upsetting a lot of people.
On Wall Street -- hedge fund managers are all over him.
For all these easy money policies I I I think it -- -- -- -- -- -- and I do not fighting deflation he's fighting deflation out and -- understand but I still think overall I think Wall -- in love this guy don't you.
You know you hear different things from different people I don't see why they shouldn't be I mean the Aggies -- -- you know we know he's he's -- stock market rally but.
But you know he did preside over a financial crisis so I don't know how many -- bombs are gone over that one.
John hills and Brad thank you John -- here who -- -- successors let us now aren't we election I -- -- a -- it's good to -- -- good -- --
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