Dated: October 8, 2013
By all measures and with few exceptions, Federal Reserve Chairman Ben Bernanke has done a great job by preventing the economy from going down the drain. Yet, President Obama was intent on replacing him, for political reasons unbeknownst to the public. During a recent press conference, a reporter asked Mr. Bernanke if it was his own personal desire not to stay on as the Fed chairman, or whether that was the president’s idea. Bernanke’s response: he did not wish to discuss his personal plan. Apparently, he wants to keep his job, yet he could not say in so many words, for obvious political reasons, that the president wanted to replace him.
For reasons not fully disclosed to the public, Obama was eager to nominate Summers, whose candidacy was derailed by political forces within his own party. Now that his chosen candidate is gone, Obama’s motivation to get rid of Bernanke may no longer exist. Most observers had previously predicted that he would make the announcement nominating the next Fed chairman in September, but that didn’t happen. Most people thought the contest was between Summers and Yellen. Now that Summers is out of the running, why has Yellen not yet been nominated? Is it because Obama, now left with a choice between Bernanke and Yellen, might consider nominating Bernanke for another term? This would allow Bernanke to complete his plan for economic recovery, with which he has done a marvelous job so far.
Based on my I Ching analysis (defined in previous blogs), Bernanke’s star will rise again in 2014 and will be sustained for decades to come, whether or not he is nominated for another term, whereas Yellen’s luck will begin to slide in the beginning of 2014. For the benefit of the nation, I hope that President Obama will decide to do the right thing.