Bernanke's Mentor Diamond Rejected By Senate For Fed Board After Shelby Alleges Lack Of Inkjet Cartridge Qualifications
For somebody of Richard Shelby's "phenomenal" skill set (at destroying capital markets) to say that someone else is unqualified to do something, is the proverbial slap in the face, with a wrecking ball. Yet a textbook example of a pot calling a kettle black is precisely what happened today when the Alabama senator said Bernanke's former economics professor, and thus implicitly the man responsible for the destruction of America's middle class, was "unqualified" to make decisions on monetary policy. Um, what the hell does one need to be a skilled monetarist, aside, of course, from a willingness to accept orders from Goldman, when the firm with actual leverage of 100:1 blows up on yet another trade, or lowering the fed funds rate to -5% whenever the latest theatrical dictator of Congress calls and demands that the "politically independent" Fed do everything to boost jobs, AMZN to $1,000 be damned, without batting an eyelid? Anyway, it looks like the president will have to once again resubmit the application of Peter Diamond to the Fed's board. And since the Senate took no action on the other two applicants, Yellen and some other female uberdove, it seems that with Kohn's departure on September 1st, the Fed will have just 4 governors until September 13, at the earliest, which is the minimum quorum for a decision. In other words, if anyone wants to really destabilize the country, the two weeks in early September should prove to be quite a good opportunity to strike.
More from Bloomberg:
The Senate sent the nomination of Peter Diamond, one of President Barack Obama’s three nominees for the Federal Reserve Board, back to the White House because of objections from at least one lawmaker.
The office of the executive clerk of the Senate said the procedural move occurred as part of actions taken on nominees without debate before the chamber left for a summer break. Don Stewart, a spokesman for Senate Republican Leader Mitch McConnell, said he expects the White House will resubmit the nomination.
While Diamond, 70, may still win confirmation, it’s a snag for the Massachusetts Institute of Technology economics professor who once taught Fed Chairman Ben S. Bernanke. Alabama Senator Richard Shelby, the senior Republican on the Banking Committee, said last week that Diamond, while a “skilled economist,” may not be qualified to make decisions on monetary policy.
The Senate took no action yesterday on the other two nominees, including San Francisco Fed President Janet Yellen for vice chairman and Sarah Bloom Raskin for a governor slot, leaving them to await confirmation after senators return Sept. 13. That means that if Governor Donald Kohn, whose separate term as vice chairman ended in June, departs as planned on Sept. 1, the Fed may be down to four governors for an unknown time.
“It’s very hard for the Federal Reserve to operate with only five people,” said former Fed Governor H. Robert Heller, who served on the board from 1986 to 1989. “Four is the minimum for a quorum. To have the Fed at full strength with seven persons there is very important.”
“Professor Diamond is a skilled economist and certainly an expert on tax policy and on the Social Security system,” Shelby said July 28. “However, I do not believe he’s ready to be a member of the Federal Reserve Board. I do not believe that the current environment of uncertainty would benefit from monetary policy decisions made by board members who are learning on the job.”
Dodd said last week he “enthusiastically” supported all three picks for the Fed. “Each brings a remarkable combination of skills and experience,” he said before the committee vote. Dodd said he expected a floor vote on the nominees in September.
Read: someone did not explain to the wannabe master of the printer that to gain access to the promised refill cartridge, he has to briber everyone equally, not just outgoing lame duck senators.