“So there’s no chance of a Jim Grant, Ron Paul, hard-money advocate at the Federal Reserve at the end of Bernanke’s term and that’s a tremendous reassurance to the market.”
Hard money restricts the growth of government and crony capitalism. If the Fed can’t print without restriction it can’t inflate the money supply. The vast majority of economists today see this as a disadvantage—or at least have. But, given the new era of money printing we have entered into, it’s hard to believe that even the most committed Keynesian doesn’t have at least some reservation in his or her heart of hearts when they see what the Fed is doing.
Even Mr. Krugman at the New York Times knows the Fed is playing with gasoline and matches. He just thinks its worth the risk.
By the way, who on The Street seriously thought that Jim Grant or Dr. Paul would ever be appointed at the Fed after a Romney victory? As Hunter Lewis has written multiple times on this site, Romney is a Keynesian and surrounded himself with Keynesian economists.