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Rumor: Bernanke To Withdraw?

Chris Bowers passes along a rumor that I’ve heard as well, that Ben Bernanke may be considering withdrawing his name from consideration for another four-year term as Chairman of the Federal Reserve.

As we have reported, there are at least five holds on Bernanke’s nomination, which will at the very least ensure a long, drawn-out process for his confirmation by the Senate. There’s a vote scheduled in the Senate Banking Committee for Bernanke this week, on Thursday, but that doesn’t mean he can’t withdraw later on in the process.

I don’t know if I’d put the possibility of Bernanke withdrawing as much higher than a 20-1 shot, but just the open talk of it is kind of astounding. This is someone who the very serious people in Washington have credited with “saving the financial system” and helping to prevent a Depression. But as Bowers notes, it could be the lack of respect Bernanke is receiving from his “lessers” that is leading him to this decision:

Through the trans-partisan holds and audit the Fed movement, Bernanke is not receiving the appropriate deference members of Congress typically show to their betters and masters. So, he petulantly threatened to take his ball and go home, unless Congress promise to be much, much nicer to him.

The other possibility is that, as the audit the Fed bill nears a real possibility of passage inside financial regulatory reform (it passed in the House bill Friday), the resultant fallout from the Fed’s sweetheart deals could be too much for any Chair to withstand.

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David Dayen

David Dayen