RTTNews - President Barack Obama announced the nomination of Ben Bernanke to a second term as Federal Reserve Bank Chairman, giving a vote of confidence to the banking system's chief regulator for the way he responded to the financial crisis.
Speaking in Martha's Vineyard, the Obama said that Bernanke's background, temperament, courage and creativity helped the country to avoid another Great Depression.
Ben approached a financial system on the verge of collapse with calm and wisdom; with bold action and outside-the-box thinking that has helped put the brakes on our economic freefall, he said.
Obama went on to say that the actions taken by the Bernanke and the Fed were done so out of necessity and helped to bring the economy back from the brink.
Echoing Bernanke's comments from recent weeks, Obama also stressed that the economy is a long way from recovery and promised to keep working to fix it until unemployment slowed, businesses could receive affordable loans and responsible mortgage holders can stay in their homes.
That is why we need Ben to continue the work he's doing, and that is why I've said that we cannot go back to an economy based on overleveraged banks, inflated profits, and maxed-out credit cards, he said.
There has been much speculation in recent months as to whether Obama would reappoint Bernanke, as the Fed chair has received much criticism from members of Congress for what they thought was an initially slow reaction to the crisis.
Both Democrats and Republicans have been critical of the steps taken to alleviate the financial crisis since the slow response. Republicans feel the government is putting too much taxpayer money at risk, and Democrats believe that it has been too willing to aid banks instead of homeowners or struggling borrowers. Others have argued that aggressive actions taken by the Fed, such as pumping nearly $1 trillion into the banking system, will lead to inflation.
However, supporters of Bernanke have said that his creativity and stable thinking helped to keep last year's financial crisis from getting worse.
Among the actions taken by the Fed were lowering interest rates to close to zero, purchasing mortgage-backed securities, direct government loans to companies and financial rescues of big firms such as Bear Stearns.
Bernanke's nomination now must be approved by the Senate, and the Chairman will likely face tough questions at his confirmation hearing.
While I have had serious differences with the Federal Reserve over the past few years, I think reappointing Chairman Bernanke is probably the right choice, Senate Banking Committee Chairman Christopher Dodd (D-CT) said in a statement. There will be a thorough and comprehensive confirmation hearing.
After Obama's remarks, Bernanke spoke briefly on his nomination, thanking the President, his colleagues at the Fed and his family. He pledged to continue to make the necessary decisions to create a strong and stable economic and financial environment.
I will work to the utmost of my abilities--with my colleagues at the Federal Reserve and alongside the Congress and the Administration--to help provide a solid foundation for growth and prosperity in an environment of price stability, he said.
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