Team Player?

Who’s next to run the Fed?

The short answer is, Ben Bernanke. He is the Fed’s intellectual center, its public face, and chief architect of its innovative policy initiatives. Conventional wisdom is that if he wants to continue as Chair when his term expires in 2014, the job is his.

There are good reasons to have him continue on the job. For one thing, overseeing our sick economy’s transition from ICU to hospital to outpatient care is going to be a touchy business. With his policy of increased transparency and aggressive public relations, Bernanke is well-positioned to interpret the Fed to the world. Also, having been there through the crisis, he likely knows what undocumented danger-zones exist—where the “bodies are buried.”

But there’s a reason to be concerned about a third term for the Chairman. It’s called “key person” risk, and it’s the risk that an institution becomes dependent upon one critical individual to drive results. Volker led a fractious Fed; Greenspan gradually presided over a personality cult; Bernanke started out trying to build a collegial, consensual culture, but the institution demands a singular leader.

So I think it’s time for a change. There are dozens of well-qualified candidates in the wings. And it would be better for Ben to leave while things are getting better.

Douglas R. Tengdin, CFA

Chief Investment Officer

If you have any questions, please write to us, at questions.

By | 2017-07-17T12:34:40+00:00 April 3rd, 2013|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

Leave A Comment