by Calculated Risk on 8/24/2010 08:47:00 AM

Last night I linked to an excellent article on the recent FOMC meeting by Jon Hilsenrath at the WSJ: Fed Split on Move to Bolster Sluggish Economy

From Economist's View: "It is Time for Bernanke to Stake Out a Public Position"

Tim Duy writes:

I understand why his colleagues appreciate Bernanke’s management style, and why the media likes to ooze quiet praise on that style, but shouldn’t he be showing some leadership in the public as well? After all, the Federal Reserve, last time I checked, was not a University economics department. It is not the same. As we like to say in academics, the disputes are bitter because so little is at stake. Not so for the Fed. As an institution, it serves the public directly, and much, much is at stake. Perhaps it is time for Bernanke to stake out a public position. How exactly does he view the current economic situation in light of his work on Japan? For many of us, that work points to a much more aggressive policy stance. Is this the direction Bernanke wants to take? If so, why is he dragging his heels? If not, then what is different? This is the conversation I want to see him have with the public, on the record. And the sooner, the better.

Mark Thoma discusses the pros and cons of Bernanke staking out a position and concludes:

[W]hen there is considerable uncertainty due to disagreement on the FOMC, the Fed chair needs to use the influence bestowed upon him or her by the Fed's institutional arrangements, set a firm course for policy, and resolve the uncertainly. That might mean having lots of informal discussions with other members of the FOMC to make sure their views get a fair hearing, and some back and forth in the process, but at some point the Fed chair needs to step up and lead. Right now is one of those times.

Paul Krugman points on the "modern version of liquidationism" that has crept into the FOMC discussions: Hangover Theory At The Fed

My guess is the Hilsenrath article is paving the way for QE2.