Difference between BEn BErnanke and Alan Greenspan?

Question

Which of their approach is differen in managing the federal reserve? DOes chairman Bernanke rule out recession?

Answer 1

Greenspan spoke in circles. He did this on purpose once he realized that his spoken word could turn the economy. He was vague about targets like inflation. He didn't put a number on anything. I loved the guy and I miss him. Bernanke is more methodical and forthcoming with his thoughts. He will target inflation in a quantitative manner. He will shoot for under 2% core inflation. That's his story and he will stick to it. Greenspan sees and recession on the horizon, but Bernanke does not. He sees the old "soft landing", but not a shake down.

Answer 2

I agree with econgal on most everything but wanted to add that Bernanke can't rule out a recession because no one in any position can.

Recessions are a fact of life and of the business cycle. You can work to make their effects smaller (the "soft landing" Bernanke is looking for) but you can never actually get rid of them.

Answer 3

Alan is a master w/ words. He said what matters most though most in gov just do what they want and hope for reelection w/o care for the long run. This was a big shift in how the fed worked. Ben is still learning and has already told them to cure SS or else.

Answer 4

The big difference is that Greenspan no longer can change poilcy, so when Greenspan speaks it scares everyone since he no longer can change the policies to back up what he is saying.

Bernake can say something and then act to follow his words.