The case was used in the first year compulsory course called the global economy and markets in the module on monetary policy. October 24, 2005, President Bush nominated Ben Bernanke as chairman of the Board of Governors of the Federal Reserve System for a term of four years with 14-year-old member of the Governing Council. The confirmation of the U.S. Senate is widely expected, Bernanke is expected to take over leadership of the U.S. monetary policy of Alan Greenspan, when he retired in January 2006. While the U.S. economy was in good shape at the end of 2005 Bernanke was prepared to deal with two problems when charting a course for the management of monetary policy. First, the sharp rise in energy prices, which began in 2002 had the potential to bring back the specter of inflation and the weakening of the desired consumer and business spending. Second, the housing boom could turn into a housing bubble, throwing the mortgage industry into chaos and weakening consumer confidence in the business community. There was also the possibility that the collapse of the real estate market can affect the broader financial markets. Bernanke had to consider its options to address unforeseen circumstances in the not too distant future.
This Darden study. "Hide
by Wei Li Source: Darden School of Business 14 pages. Publication Date: October 19, 2007. Prod. #: UV0737-PDF-ENG
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