(Corrects names to Rivlin from Rivaling, 21st paragraph, to
Wessel from Weasel, paragraphs 22-23, to TD's Mulraine from SD's
Murrain in last paragraph)
* Former Fed chair becomes distinguished fellow in residence
at think tank
* Centrist Brookings prides itself as nonpartisan
* Yellen sworn in as U.S. Federal Reserve chair
By Jonathan Spicer
NEW YORK, Feb 3 Former Federal Reserve Chairman
Ben Bernanke began his new job at the Brookings Institution on
Monday, wasting no time getting back to work just three days
after ending his tenure as head of the world's most powerful
Bernanke, who led the U.S. central bank in its aggressive
efforts to right the economy after the financial crisis and pull
it out of the Great Recession, joined the centrist policy think
tank in Washington as a distinguished fellow in residence,
He settled into his office in the morning, a spokeswoman
said, and a new colleague saw him in the cafeteria at lunchtime.
Bernanke, appointed by Republican President George W. Bush
as Fed chairman in 2006, gaveled his final policy-setting
meeting last week, at which the central bank continued its
winding down of the controversial and massive bond-buying
program that was Bernanke's signature strategy to jump-start the
He was succeeded as Fed chairman by Janet Yellen, the
former vice chair who was sworn in on Monday morning.
Brookings is home to a number of other former Fed officials,
including Don Kohn, the vice chair who preceded Yellen. The
institution, home also to scholars on a vast range of topics
from climate change to refugee resettlement, prides itself as
politically nonpartisan and having members on the left and
right, although some see it as somewhat left of center.
The former Princeton professor is expected to write a book
and has brought along one of his top Fed press deputies, David
Skidmore, to help with editing and research. There are no formal
restrictions on his speech now that he is in the private sector,
though like any other Fed official he is barred from disclosing
"I will still pay close attention to what he says and
writes, not because I think he'll have some inside edge on what
will happen next with Fed policy, but because he is still one of
the smartest guys on the planet when it comes to central banking
and monetary theory," said Michael Feroli, JP Morgan's chief
According to a Brookings statement, Bernanke will help bring
"rigorous analysis to critical questions" at the institution's
new Hutchins Center on Fiscal and Monetary Policy, which is
named for private equity investor and donor Glenn Hutchins.
Bernanke's last public appearance was January 16 at
Brookings, where he said the Fed should give the economy the
stimulus it needs despite "credible" worries that its massive
bond-buying could destabilize the financial system.
Last week, in his final act as chair, Bernanke and fellow
policymakers unanimously agreed to trim $10 billion more from
the quantitative easing program, which is now running at $65
billion per month.
SPOTLIGHT WILL FADE
Bernanke bought trillions of dollars of bonds and promised
to keep interest rates near zero well into the future as he
fought to respond to the 2007-2009 financial crisis and
recession, which infected the rest of the developed world and
saw the U.S. unemployment rate climb to 10 percent in 2009.
Bernanke was not available for an interview. The Brookings
spokeswoman did not comment on his compensation, or on what
areas he would focus his initial work.
Having warm ties with Yellen and the respect of the
remaining Fed policymakers, Bernanke will probably draw
economists' and investors' attention for some time.
"Given that he was an integral part of the policy decision
making over the past five years ... over the next year he will
have some value to the market but less so than Yellen, and it
will diminish over time," said Millan Mulraine, a researcher at
TD Securities in New York.
"I suspect he will probably keep a fairly low profile - he
doesn't want to complicate the process for the new chair."
A QUIET PLACE TO WRITE A BOOK
While Bernanke legacy will hinge heavily on whether the
Fed's massive balance sheet, at $4 trillion and counting, sparks
inflation or market disruptions in the future, for now he is
being praised as the soft-spoken chairman whose unprecedented
policy actions helped avert economic calamity.
His decision to move to a think tank contrasts with the job
history of his predecessors.
Alan Greenspan, whose tenure at the Fed is now clouded as
having sown the seeds of the crisis, has been criticized for
cashing in on his experience by consulting for Wall Street. The
former chairman founded his own consulting firm shortly after
stepping down on Jan. 31, 2006, and a year and a half later was
lending his expertise to Deutsche Bank.
Seven months after former chair Paul Volcker stepped down in
1987, he became part-owner and chairman of a small New York
investment banking firm, Wolfensohn & Co. Volcker also took a
professorship post at Princeton University, where he had gone to
Brookings, located about a mile (1.6 km) north of the Fed's
headquarters in the U.S. capital, is also home to former Fed
vice chairs Kahn and Alice Rivlin, who are senior fellows at the
economic studies program that Bernanke joins. Former Fed
Chairman William McChesney Martin was on its board of trustees,
and Leal Brainard, who has been nominated to serve on the Fed
Board, was a senior fellow there for many years.
David Wessel, a former reporter who is now a director at the
Hutchins Center, quipped that Bernanke will not have to sit
through any more policy-setting meetings, testify to "an
occasionally hostile Congress," or "listen to complaints from
emerging market central bankers."
In a note on the Brookings web site, Wessel also said
Brookings will help with the book Bernanke plans to write.
TD's Mulraine said he plans to read Bernanke book, not that
it will contain any "salacious details" about the Fed but for
the insights it will provide about policymaking.
(Additional reporting by Ann Saphir in San Francisco and Emily
Stephenson in New York; Editing by Chizu Nomiyama and Grant