Reply #20: BS Bernanke, Avoiding Ambiguity, Delivers on Vow to Be Transparent

[54anickel]

http://www.bloomberg.com/apps/news?pid=10000103&sid=aGg5gnmhXPsE&refer=us

March 24 (Bloomberg) -- Ben S. Bernanke, who promised to make the Federal Reserve more transparent when he became chairman, is delivering on that pledge even before his first interest-rate meeting.

Since succeeding Alan Greenspan on Feb. 1, Bernanke, 52, has publicly laid out his views on a host of issues: Stable inflation is the key to economic growth; soaring asset prices don't warrant more rate increases; low long-term bond yields aren't a sign of a coming recession.

Such clarity may remove some of the guesswork in predicting Fed rate moves under Greenspan, economists said. Bernanke's positions, while consistent with his statements as a Fed governor from 2002 to 2005, now come with a ``much greater megaphone,'' said Alan Blinder, a former Fed vice chairman.

``The real goal of central bank transparency is to get the markets thinking the way you think,'' said Blinder, an economics professor at Princeton University in New Jersey, where Bernanke worked before his first Fed stint. Bernanke's openness is ``much better than hinting, which of course he won't do, about what the Fed's going to do at its next meeting'' on interest rates.

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