Bush renominates Greenspan

Bush renominates Greenspan
President taps 78-year-old Fed chief for another term as chairman; Greenspan accepts.
May 18, 2004: 2:21 PM EDT

NEW YORK (CNN/Money) - President Bush nominated Alan Greenspan to another four-year term as chairman of the Federal Reserve Tuesday, and Greenspan accepted.

White House press secretary Scott McClellan made the announcement just before Bush met with the 78-year-old Fed chief.

"Alan Greenspan has done a superb job as chairman of the Board of Governors of the Federal Reserve system and I have great continuing confidence in his economic stewardship," McClellan said, reading a statement from Bush, according to Reuters.

"Sound fiscal and monetary policies have helped unleash the potential of American workers and entrepreneurs, and America's economy is now growing at the fastest rate in two decades," he added.

Asked why Bush is not looking at bringing in someone new for the Fed job, McClellan said "the president wants him to continue to serve as long as possible."

"I am honored to be nominated by President Bush and, if confirmed by the Senate, to continue my service as Chairman of the Board of Governors of the Federal Reserve System," Greenspan said in a statement.

The move could help Bush in his efforts to win re-election in 2004.

Keeping a popular central bank chairman, believed by many to be a "maestro" of economic policy, could quiet some critics of Bush's handling of the economy, which was slow to recover fully from the 2001 recession.

Greenspan was first appointed chairman of the nation's central bank by President Reagan in 1987. His current term as chairman runs out next month -- at the height of the presidential election campaign.

After more than 16 years at the helm of the world's most powerful central bank, Greenspan enjoys legendary status for his role in guiding U.S. monetary policy.


Despite criticism for not acting to pop the stock market bubble of the 1990s, he has earned some praise for his handling of the 2001 recession as well as the stock market crash of 1987.

The Fed chief recently indicated that the central bank will start raising short-term interest rates soon in a bid to ward off inflation.

While Greenspan's term as chairman was due to expire next month, his full 14-year term on the Fed's board of Governors doesn't expire until 2006.  

http://money.cnn.com/2004/05/18/news/economy/greenspan/index.htm