Ben Bernanke, chair of the economics department, made national headlines Wednesday when President Bush nominated him to one of seven positions on the Federal Reserve's Board of Governors.
Bernanke, 48, will represent the Atlanta District on the board. Once appointed, he will serve the remaining two years of a seat previously occupied by Edward Kelley Jr., who resigned in December.
Bernanke is one of two economists recently nominated to the Federal Reserve Board. Longtime Fed staffer Donald Kohn is expected to fill another seat. Both nominations are pending approval by the U.S. Senate.
Bernanke plans to take a leave of absence from the University after his appointment.
His term on the Fed will last until Jan. 31, 2004.
At the end of the term, he will either return to the University or seek reappointment to the Fed.
Many have economists applauded Bush's selections, saying the president nominated two of the most prominent monetary experts.
Some analysts consider the selection of Bernanke and Kohn as a move by the administration to increase the board's expertise in monetary affairs — in preparation for when current chairman Alan Greenspan leaves the board.
"If you made up a list of the most qualified people in the country, [Bernanke and Kohn] would both be on it," said Laurence Meyer, who left the board in January.
Bernanke is not new to national economic affairs. In addition to chairing the economics department, he also serves as director of the monetary economics program of the National Bureau of Economic Research, a member of NBER's Business Cycle Dating Committee and editor of the American Economic Review.
"I'm really pleased President Bush nominated me. I'm really looking forward to my time on the Fed," Bernanke said yesterday in an e-mail interview. "I hope my skills in macroeconomics and statistical analysis will prove useful in making policy."
Bernanke has argued for inflation targeting, a monetary policy in which the central bank publicly announces a desirable inflation rate. Greenspan, however, has been reluctant to accept such an approach, considering it too rigid. Despite their differences in curbing inflation, Bernanke has said he is in general agreement with Greenspan's monetary policy.
Though Bernanke's appointment is currently pending, Wall Street analysts have speculated that Bernanke could be a likely candidate to succeed Greenspan, whose term will expire in June 2004.
Bernanke, however, considers the speculation preemptory, calling it "highly premature, to say the best."
(The Associated Press contributed to this report.)
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