Should Bernanke Be Re-Appointed?

Some (most) of my readers probably thinks that my answer to that question is something like "Hell no!". And if there was a better alternative that would indeed be the correct answer. But as the situation is right now I, like Paul Krugman, find myself undecided with mixed emotions (though my reasons are of course radically different from Krugman's).

On the one hand, Bernanke certainly doesn't deserve to be reappointed, as he along with Greenspan and a few others was responsible for creating the current problems. The fact that he appears to have learned nothing from this and tries to mislead people into believing that monetary policy didn't create the problems only makes his possible ouster even more well deserved.

On the other hand, who would replace him? Hardly any Austrian, or other sound money advocate. Instead it would most likely be someone (perhaps Larry Summers) with similar views who would pursue similar policies. Only that person would with his looser connection to the housing bubble or "Helicopter"-reputation gain more trust and be less vulnerable to criticism.

So, as richly as Bernanke deserves to be ousted, doing so might not make things any better. It could in fact make things slightly worse.