Without fingering Bernanke, the former Fed chairman talks tough in reiterating the Fed's responsibility to "resist pressures toward inflation"So which is it, Paul Volcker? Is Ben Bernanke doing the right thing as Federal Reserve chairman or not?
Volcker, who himself ran the Fed from 1979 to 1987, broke his silence on Bernanke's performance in a major address on Apr. 8, saying the Fed's recent dramatic actions (BusinessWeek, 3/26/08) to arrest the credit crunch "extend to the very edge of its lawful and implied powers." That seemed like a pretty clear criticism of Bernanke. But a day later, Volcker told reporters he felt his remarks had been misinterpreted. Referring to a New York Times headline that said "Ex-Fed Chairman Chides Current One," Volcker said "I thought that was ridiculous." He added: "It's the opposite of what I think."
Until now, Volcker has been far quieter about the institution he used to run than has Bernanke's immediate predecessor, Alan Greenspan. On the lecture circuit, Greenspan has repeatedly offered his views on the state of the U.S. and global economies, though he has generally avoided specific comments about Bernanke. Volcker preferred to keep his views to himself.
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