Fed Food

Was the grilling of the Fed chair a summer sizzler?

When Bernanke testified before Congress last week, a lot of people were surprised by the rancor. But this is a sensible approach to a newly political institution.
In the fabled days of yore, the Fed used “System RPs” and “Bill Passes” to manage the money supply and regulate the use of the discount window. On a good day, they could oversee a bank holding company exam.

But once the Fed gets involved in saving banks and creating investment vehicles, the central banker has become political in a major-league way. Arranging marriages and re-writing rules has major implications. Someone’s ox will be gored. Those are political decisions, and they requires political accountability.

Now seeing Barney Frank grill Ben Bernanke was distasteful, but I know no other approach. The Fed isn’t all-knowing. If Bernanke can’t handle that heat, he needs to get out of Washington’s kitchen.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By |2014-09-04T18:42:37+00:00June 30th, 2009|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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