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What Happens If Bernanke Is Not Reconfirmed By January 31?
With Bernanke's reconfirmation getting dangerously close to not being reality by the January 31 deadline, courtesy of a few non-Wall Street captured politicians in the Senate who are doing all they can to delay the process, a key question asked today is what will happen to the Fed Chairmanship position on February 1. The WSJ Blog provides some perspective on why this could be a destabilizing event to the tranquility that has gripped all trading desks, where conviction that the guy who is allegedly gobbling up futures without respite, may soon became scarce.
Senate Banking Committee Chairman Chris Dodd said Monday that Ben Bernanke cannot remain as chairman of the Federal Reserve if the Senate does not confirm him by Jan. 31 when his four-year term expires. In an interview on CNBC, Dodd said Fed Vice Chairman Donald Kohn would take over as chairman. Sen. Judd Gregg (R., N.H.) made the same point. The comments generated some confusion on Wall Street, but the situation isn't clear-cut.
This much is clear: A Fed chairman cannot automatically stay in his position after his four-year term as chairman expires. Members of the Fed board, in contrast, can remain in office as governors until their expired term has been filled. The Federal Reserve Act says that the Fed vice chairman acts as chair in the "absence" of the chairman. But "absence" is not defined.
The expiration of a chairman's tenure pre-reconfirmation is not a new thing, and has in fact happened on two prior occasions:
In 1948, Marriner Eccles served as chairman pro tempore from Feb. 3 until April 15, when Thomas McCabe was sworn in as chairman. And in 1996, Alan Greenspan served as chairman pro tempore from March 3 to June 20, when he was confirmed by the Senate for a third term as chairman.
The fact that at least four Senators have discovered their patriotic conscience and realize that more so than anyone, it is precisely Ben Bernanke who is responsible for the current financial fiasco, and are willing to prevent his reconfirmation using all legal channels, should force the Fed to actively consider what Plan B would and should be. Ironically, a nation without a Central Bank head would be the best thing that could happen to this country, which is why we are ultimately skeptical that the power interests of the landed Wall Street oligarchy would ever allow the possible pro tempore option, let alone his removal.
The Fed and Sen. Dodd hope the confirmation vote will come soon after the Senate reconvenes Jan. 19. But at least four senators have placed holds on the nomination, forcing Senate Majority Leader Harry Reid to schedule a floor debate about Bernanke, invoke cloture on the nomination and prepare for an up-or-down vote. At the moment Bernanke seems to have the 60 votes he'd need to be confirmed. But if the Senate delays a full vote past Jan. 31, the Fed's Board could be forced to make a decision to avert worry on Wall Street.
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it doesn't really matter, clones would take the helm until a new nominee (also a clone) was confirmed e.g.Yellin
but Bernanke will be re-confirmed
.
He will be, if not by vote through executive branch. Welcome to fascism
Kohn is the apparatachek in residence. He is every bit Benron's equal.
The fact that at least four Senators have discovered their patriotic conscience......
Seriously, Tyler "patriotic conscience"? More like populist pandering, due to the upcoming mid-term elections.
true lizzy. whatever it is, i'll take it
+1 Sometimes we just have to drop the cynicism to enjoy the moment. The Dems leaked the Reid quote to get him out of the race (he will lose), but I'm not going to cry about a good thing.
yeah god forbid our politicians would do something WE THE PEOPLE want them to do.
So shall we buy on the dip coming up?and is Cohn going to keep on buying futures or not?. Common guys,be realistic,and where will all the Wall st. "geniuses"go?last I heared Nasa and JPL are not hiring,and Volvo and Saab are being sold.No more engineering ingenuity is needed,only financial inginuity and money creation are the norm of the day. I say posturing continues,and BB or similar will be back. (lol)
Nothing will happen !! Some other moron will take his place and keep the "magic" going !!
/
Bernanke is a clear and present danger to the well being of the United States of America.
+1
Although - at this point in time, what alternatives are there for him to redeem himself? What is it that he is hoping to accomplish? "I hope the fundamentals somehow improve before this house of cards collapses."?? I think we're past a point of no return, all there is to do now is wait. The damage has been done.
The 'outside-of-the-box' alternative is to abolish the Fed. Sooner rather than later.
www.AbolishTheFed.info March 2008WHEREAS, Article I, Section 8 of the Constitution of the United States of America authorizes Congress "To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures";
WHEREAS, on December 23rd, 1913 the US Congress enacted the Federal Reserve System;
WHEREAS, the Federal Reserve System is considered an independent agency within the federal government, with oversight of Congress and containing appointed public officials on its board of directors;
WHEREAS, the Federal Reserve System Controls the Federal Reserve Note, the official currency of the great nation of the United States of America;
WHEREAS, there may be controversies regarding the legality and constitutionality of the Federal Reserve System, it is recognized that the said system has operated continuously as the central banking system of the United States since the inception of the Federal Reserve Act of 1913;
WHEREAS, the Constitution of the United States of America granted Congress the authority to create the current Federal Reserve System, it also does grant Congress the authority to modify or revoke the Federal Reserve System;
WHEREAS, the actions of the Fedreral Reserve System represent the credit and currency of the United Stated of America to the citizens of this great nation and to the world;
WHEREAS, the Federal Reserve System, acting independently within the federal government allowed, supported, and even promoted parasitical and non-productive uses of the money and credit of the United States of America;
WHEREAS, the United States and likely the entire world's financial system is undergoing massive de-leveraging of the said parasitical and non-productive uses of the credit and money of the United States of America (as well as other nations' currencies);
WHEREAS, the US dollar, the "Federal Reserve Note" is declining in value due to these parasitical activites, as well as potentially other causes;
WHEREAS, it is recognized that the citizens of the United States and other nations did willingly participate at some level in the creation and propogation of said parasitical activities;
WHEREAS, it is also recognized that the United States of America, a sovereign nation, has the legal, moral, and God given authority to take actions to benefit its citizens and to protect its good name, credit and money in times of difficulty;
WHEREAS, it is recognized that the current time is such a time of great difficulty;
WHEREAS, it is recognized the parasitical financial institutions and their activities are at odds with citizens of the United States of America and the good credit and money thereof;
WHEREAS, the current indications are that the Federal Reserve System is acting to preserve the financial system currently flooded with the parasitical activities;
WHEREAS, the current indications are that the neither the Federal Reserve System, nor the Congress of the United States, nor the people of the United States have access to the books of the institutions being preserved by the Federal Reserve, and therefor the degree of inter-connectivity and risk associated with the institutions and other entities cannot be determined;
WHEREAS, the Federal Reserve System is accepting non-performing assets as collateral for credit with ultimate taxpayer responibility to entities not under its legislative mandate;
IT MUST BE CONCLUDED, that the Federal Reserve System is not acting to the benefit of the people of the United States of America, its credit, money, and good name;
WHEREAS, it is recognized that the political will and capability of the government of the United States of America may not be up to the task of prosecuting this proclamation ; It is also recognized that this may be the only hope for the continued survival of the United States of America as the great nation as it has historically existed.
NOW THEREFORE, it is PROCLAIMED by those supporting this Proclamation that the Congress of the United States of America FULLY NATIONALIZE the Federal Reserve System, and take full control of the credit and money of our great nation; The Congress must take whatever action necessary to seperate out, sequester, disown, or otherwise neutralize the effect of the parasitical financial activities which led to the current crisis; The Congress of the United States of America must reorganize, replace, or terminate the Federal Reserve System as appropriate; or otherwise devise a system for creation of the national currency.
IT IS FURTHER PROCLAIMED, that the Congress of the United States of America in cooperation with the Executive of the United States of America contact allied nations and any other nation willing to participate in the overhaul of the failing and parastical financial sytem currently in operation and create new treaties and alliances as necessary to create a sane and productive system of finance with the express goal of supporting a productive national, and by extension and through voluntary cooperation, world economy;
FURTHERMORE, it is PROCLAIMED that it should be the goal of such an international effort to maintain fair international trading practices allowing for protection in national interest of labor, resources, and productive capabilities;
WHEREAS, it is recognized that such a move on the part of the United States of America may result in the necessity of an isolationist policy IF the other developed nations do not follow our lead; If such occurs, so be it.
SO HELP US GOD!
+100. Where is Jack Ryan when we need him?
"Bernanke is a clear and present danger to the well being of the United States of America."
I agree. It is like he is trying to transfeer all of Americas wealth to the Banksters before a Collapse of the United States.
Americans be dammed.
Here's hoping that Bernanke starts fearing not only for his job, but also his life.
An absolutely unacceptable comment.
An absolutely unacceptable comment.
Waahhhhhh!
Well, obviously I disagree. What are you going to do about it, anonymous pansy?
Well, if Benny must go, I'm sure Larry is more than happy to assume the printing position...
Does anyone honestly believe he won't be confirmed? I mean, I'd be thrilled, but it's not going to happen. The criminals in the Senate will confirm him, because they're bought and paid for.
Interesting the hearings come right after opex for January.
I have told my elected officials in Arkansas that a No vote is a necessary condition for my vote in November.
This has to be stopped one way or another. If our elected officials won't do it ... well ... we need new ones who will.
Throw the bums out is the only thing I can think of. Here in Arkansas Ms. Lincoln needs to start thinking about her poistion. It's a litmus test for sure.
Told mine in NH to vote no.
Judd Gregg replied that Bernanke "prevented a more serious meltdown" and "the President made a wise choice in nominating him to serve a second term" and that "after listening to Mr. Bernanke's testimony, I decided to support his nomination".
Shaheen never acknowledged my email.
So that's 2 NH Senators' yes votes.
how could they NOT? after all, he is MOTY (man of the year)
Interesting that DODD says. DODD says.
Seems like DODD might be looking for a new gig soon too.
nothing happens
"But if the Senate delays a full vote past Jan. 31, the Fed's Board could be forced to make a decision to avert worry on Wall Street" - yeah, that's the most important problem for the Fed. And where did in the Fed Act does it say that's Fed's main task is to keep Wall St. from worrying too much???
I see 2 scenarios: Scenario #1: if they feel there's a tiniest chance of non-confirmation, they'll act before Jan 31. You'll see the motherload... the bazooka of all bazookas, no the Enola Gay of all QUs ever used. The last QE would fail in comparison. When threatened, bankers become ever more dangerous.
Scenario #2: Senate doesn't confirm Ben without any prior warning - Kohn becomes "the man" (if you can use such name for a wall st. b**ch.) Scared to death that soon after the Fed's wall of secrecy, and then the entire institution would be dismantled or seriously modified, Kohn &Co will print as much money as the Wall St. banks can carry out of the Fed.
Where are those 60 votes??? I don't think they are there. If they're not, you can be sure that Sen Bunning will be reading Moneyball to the rest of the Senate.
What happens if Bernanke is not reconfirmed....
And there was much rejoicing!!
Bernanke should trade the beard for a funny, little mustache, wear a brown shirt and profess his admiration for Marlene Dietrich.
i think he looks more like lenin or mao
He looks like a 10 year old thief caught ripping off cash from his dad's billfold.
The question is, What Happens If Bernanke Is Not Reconfirmed By January 31?
The answer is, the same thing that would happen to the NFL if all professional football players had to graduate from college before being drafted.
Party!
"Ironically, a nation without a Central Bank head would be the best thing that could happen to this country,"
Yeah, we'd end up being invaded by another central bank drone or be included on the next "axis of evil" list.
if satan's asshole is not reconfirmed as chairman of the financial terrorist board some other piece of arrogant shit will take his place....
larry summers, robert rubin, hank paulson, geithner, sheila bair are all candidate sock puppets of hell...
If the 60 votes were there he'd be confirmed by now.
FROM MY NORTH CAROLINA SENATOR, KAY HAGAN:
"The formulation of monetary policy is a decision-making process that involves information gathering from a host of foreign governments and central banks. The information provided from those exchanges is critical and extremely sensitive. The immediate and broad disclosure that S. 604 would require could disrupt the financial markets, and jeopardize our country's international finance relationships. Ultimately, it would be taxpayers who would bear the brunt of any losses resulting from policies caused by untimely disclosure of sensitive information. Because of this, I do not believe the benefits of legislation like the Federal Reserve Sunshine Act outweigh the costs."
"Again, thank you for contacting my office. It is truly an honor to represent North Carolina in the United States Senate, and I hope you will not hesitate to contact me in the future should you have any further questions or concerns."
Sincerely,
Kay R. Hagan
you must be so proud.
"Tax payers would bear the brunt..." Is this supposed to be a joke?
No kidding! A new low in pathetic.
Seems to me you need to help unelect Kay.
Black Says Geithner `Cover Up' Also a Bernanke Scandal: Video
http://www.youtube.com/watch?v=S3X5aN9whq0&feature=sub
I always viewed the early reconfirmation of Bernanke was a way to kill his renomination and replace him with a crony, namely Summers.
The early reconfirmation is just a way to expose him to all his defects, with enough time to name a new nominee and not have a lot of pressure to reconfirm because of the lack of time.
There you have it: Benny out. Larry in.
it's no secret that the "smartest guy in the room who drinks alot of diet coke" has as his life long ambition the Fed Chair.
There is absolutely zero political chance that Summers would even be nominated by Obama/Rahm due to his past treasury experience (just the Brooksley Born/derivatives matter would be tooooo much bad ink) and even moreso from the political perspective of Obama's base, his remarks about females while at Harvard; the Harvard matter alone is something ramrod Rahm wouldn't even want to fight about.
Obama has just about zero political capital left with his base when it comes to the financial crisis: they are absolutely beside themselves and feel enormously betrayed (by the way, they are correct, Obama has betrayed them and the USA for that matter by letting summers, bernanke et. al continue their rampage on the treasury and dollar).
Obama realizes at this point his jawboning of the banks and wall street has been outed by his base as a bunch of bullshit; the libs and Dems are not stupid in that regard and the bonus grab by the banks (of profits that should be reallocated to capital and loan loss provisioning) and wall street is just pouring gas all over the matter. Obama is trying again today with the pronouncement of a "fee" on banks to cover bailout costs.....he will need to do more than that before the midterms and my call is he will attempt to get tougher on banks. by the way, "tougher" does not mean doing the right thing to fix the messs, but he will have to escalate toughness until the polling shows him to be doing better. by that time, mr. market will be crucifying banks for the valuations that they are currently fetching as he will remember to look under the bank's knickers and remember that whole FASB 157 matter....
how ironically sweet...current main page headline at HuffPo:
FEDERAL RESERVE SEEKS TO BLOCK RELEASE OF U.S. BAILOUT SECRETS
summers remarks about women would be swept under
the rug as quickly as reid's comments about
obama's skin color....trent lott eat your
heart out baby....
We unpack a baggie of green shoots?
No Ben, no biggie. The Federal Reserve will simply put a new clown suit on their next joker.
This article just sets the bears up for major disappointment
and a blast up in their face once Bernanke gets reappointed, which he will. 100% guaranteed.
It's an election year folks. No politician is willing to take a chance that his/her vote against Bernanke somehow causes the markets to relapse into crisis. All politics is local and forcing a floor debate just gives the repubs a chance to flash their peacock feathers in the direction of their angry tea-bagging constituents. Politics 101.
Besides, Donald Kohn should spell his name Klohn, as he is just a clone of Greenspan/Bernanke. What's the difference.
The alternative may be to vote for Bernanke's reconfirmation then watch the equity markets unravel going into the midterm election. You feeling lucky. Well are you?
Looks more and more like not having to vote at all on Bernanke's reconfirmation is the best political option for the Senators.
The reply from Senator Hagan says all you need to know about just how ill informed our "Representatives" are when it comes to the FED.
You do realize that Dodd and Reid are out of the game right, lizzy36?
And to think that OUR taxpayer dollars are spent to provide security for Ben "satan's arsehole" Bernanke...