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December 2, 2014

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review August 26, 2013 / 20 Elul, 5773

Why Obama's delaying Fed pick is continuing to damage America

By Robert J. Samuelson




http://www.JewishWorldReview.com | Was this necessary?

The struggle to succeed Ben Bernanke as chairman of the Federal Reserve has turned into a soap opera. Bernanke, it is widely assumed, has told President Obama that he doesn't want a third four-year term -- or has been informed that he won't be reappointed. This has triggered a highly public campaign by partisans of the two leading contenders for the job: Lawrence Summers, ex-treasury secretary (in the Clinton years) and former Harvard president; and Janet Yellen, the Fed's present vice chairman. Both are economists.

Summers, say his fans in op-ed articles and anonymous quotes, is "brilliant" and an experienced crisis manager. (He helped defuse the 1997-98 Asian financial crisis and, as a top Obama aide in 2009, dealt with the Great Recession.) Yellen's supporters counter that she was an early prophet of the housing crisis and is a consensus-builder and an articulate communicator. She also would be the first woman to head the Fed. Inevitably, each campaign questions the other candidate's qualifications. Summers is accused of arrogance; Yellen is seen as soft on inflation (a "dove" in Fedspeak).

All this could have been avoided, or minimized, if the president had made his choice in early summer. The result is that whoever wins -- or perhaps a dark horse, for instance ex-Fed Vice Chairman Donald Kohn -- will need to overcome the doubts and ill will created by Obama's indecision. This is an extra headache to go with many others, because today's Fed is very different from the one Bernanke inherited from Alan Greenspan.

Under Greenspan, from the summer of 1987 to early 2006, the Fed seemed almost omnipotent. Small tweaks up or down in interest rates could, it appeared, sustain economic expansion and contain inflation. During this period, job creation topped 30 million. The two recessions, those of 1990-91 and 2001, were mild by historical standards. Stocks rose more than fourfold. The Fed became more popular. In his confirmation hearings, Bernanke was emphatic: I will continue Greenspan's policies.



History dictated otherwise. With hindsight, Greenspan's apparent success in stabilizing the economy fostered the financial crisis. Bankers, consumers and companies became overconfident and complacent; they took risks that seemed justifiable but were ultimately disastrous. In the Bernanke era, the Fed's limited powers have become obvious. To be sure, Bernanke's deft interventions in 2008 and 2009 probably prevented another Great Depression. But the Fed has had less success in stimulating a strong recovery, despite keeping short-term interest rates near zero since late 2008 and trying to depress long-term rates by buying about $2.8 trillion of Treasury and mortgage bonds.

Bernanke has been an avowed experimenter; bond-buying has been his big experiment. It's an understandable gambit to reduce human suffering, and in some ways, it has changed behavior. A decade ago, it was unimaginable that the Fed would openly try to "talk up" the stock market; now, that's routine because one goal of the bond-buying (referred to as "quantitative easing" or QE) is to encourage more stock purchases by lowering interest rates on bonds, a competing investment.

Still, the economic effect has been modest at best. Slightly lower interest rates didn't cause a burst of production and job creation. Indeed, a study from the Federal Reserve Bank of San Francisco estimated that the second round of QE added only 0.13 percentage points to economic growth. (Other studies show larger effects.) Even these benefits might be reversed if the bond-buying slows or stops. When Bernanke announced a possible cut in purchases to begin later this year, interest rates shot up -- exactly the opposite of what the Fed wants. Good intentions do not guarantee good outcomes.

The next chairman faces both political and economic challenges. Because the economy is doing poorly, the Fed is not popular. It's blamed for creating the crisis, aiding Wall Street and being too powerful. There is no relief from this resentment until the economy improves, but the next Fed chairman needs to prevent the discontent from worsening. Down that road lie many bad ideas that Congress might foist on the Fed, starting with compulsory credit allocation: the forced funneling of loans to politically connected industries. The Fed's economic challenge is to deliver what it promises and to respond competently to the unexpected. This includes keeping a watchful eye on inflation.

Being Fed chairman requires economic smarts, financial knowledge, political instincts and communications skills. Summers and Yellen each has strengths, but neither has a clear advantage over the other. It's a judgment call -- and Obama should make it sooner rather than later. The longer the uncertainty continues, the greater the damage.

Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.

Comment on Robert J. Samuelson's column by clicking here.



08/22/13: Revealed! The one fact the administration doesn't want you to know about the economy's stubborn sluggishness
08/19/13: From bubble to bottleneck: The unintended side effects of other government policies
08/15/13: A better, brighter America? We're defining prosperity down
08/12/13: The news isn't free
08/08/13: ObamaCare has already caused health care cost growth to slow?
08/25/11: Inflation is the answer?
08/09/11: The big danger is Europe
07/27/11: Why are we in this debt fix? It's the elderly, stupid
07/25/11: Postwar Pillars Of Capitalism Are Crumbling
01/27/11: How Obama's speech muddied the budget debate
01/24/11: China's new world order demands stronger U.S. response
10/18/10: What's left in the Fed's toolbox?
10/11/10: The Age of Austerity
09/20/10: The ritual of sound-bite economics
08/09/10: America's parent trap
08/02/10: Hope for our energy future
07/29/10: Why CEOs aren't hiring
06/07/10: Duped by success
05/31/10: Why Obama's poverty rate measure misleads
05/17/10: Wake up, America
03/22/10: The maestro's misconceptions
03/15/10: Obama's illusions of cost-control
01/14/10: In the aftermath of the Great Recession
12/29/09: Democracy's demolition derby
11/30/09: Bipartisan threats against the institution that saved America from depression
09/14/09: Give It to Us Straight
09/07/09: Bad Future for Jobs?
08/24/09: A Rail Boondoggle, Moving at High
08/10/09: Championing the Status Quo
08/03/09: We'll remain in denial, prisoners of wishful thinking, until the fateful reckoning arrives in the unimagined future
07/27/09: Obama's misleading medicine
07/13/09: Americans' self-indulgence hurts us
07/06/09: Economists out to lunch
06/29/09: Panics ‘R’ Us!
06/08/09: Flirting with deflation or inflation? Now the economy might be at risk of both
05/25/09: A ‘crisis’ America needs
05/18/09: Will somebody finally say that Obama is irresponsibly mortgaging our future?
05/04/09: The Bias Against Oil And Gas
04/27/09: Environmentalists maximize the dangers of global warming while pretending we can conquer it at virtually no cost
04/20/09: Our Depression Obsession
03/23/09: Geithner treads a line between financial paralysis and populist resentment
03/23/09: American Capitalism Besieged
01/06/09: The limits of pump priming
12/29/08: Humbled By Our Ignorance
07/31/08: The homeownership obsession
07/24/08: A Depression? Hardly
07/17/08: Why isn't globalization making the interconnected world more stable?



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