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Economists, lawmakers, bloggers and others weigh in on President Obama’s decision to reappoint Fed Chairman Ben Bernanke.

While I have had serious differences with the Federal Reserve over the past few years, I think reappointing Chairman Bernanke is probably the right choice. Chairman Bernanke was too slow to act during the early stages of the foreclosure crisis, but he ultimately demonstrated effective leadership and his reappointment sends the right signal to the markets. –Sen. Chris Dodd, (D., Conn.), Chairman Senate Banking Committee

[Ben Bernanke]

The experience that Bernanke has acquired will be invaluable. I don’t mean this to sound like a back-handed compliment, but Bernanke is not the same person today as the one who made the decisions that his critics object to. –Louis Crandall, Wrightson ICAP
I think it’s good news for the Federal Reserve. It’s good news for the country. It’s a great choice. Chairman Bernanke has done a terrific job in bringing openness to the Fed. He has been bold and creative in dealing with the financial crisis… It was not clear to most people that the crisis was going to be as broad-based, and that the excesses in the financial markets and in lending were as broadly based as they turned out to be. Even at the start, he was willing to consider all options to deal with what appeared to be more a liquidity than a solvency crisis. As it began to become more clear that it was a crisis of solvency and leverage and a classic credit crunch, he didn’t flinch in bringing enormous creativity to bear in mitigating the problem –Richard Berner, Morgan Stanley
Having a new chairman come in at this late date would put the Fed engineered solution to both the recovery and the exit strategy at risk. The Federal Reserve made a hasty exit from easy money stimulus in the 1930s and we know how that worked out… Mistakes have been made at many regulatory institutions during this crisis, but all the Fed’s mistakes would have been made by any man according to the prudent man rule. Bernanke is a true prudent man who calls them as he sees them, and knows the ins and outs of policymaking… If he can pull off this recovery that still needs nurturing, he could well go down as one of the greatest Fed Chairmen in history. –Christopher Rupkey, an economist with Bank of Tokyo-Mitsubishi
History shows that uncertainty is the enemy of markets. Much speculation about Bernanke and a possible Summers succession has swirled in market analysis circles. That is over… We wish the reappointed chairman success. Meanwhile we remain vigilant and recognize that, in a globally linked world, financial integration means that no single central bank and no one chairman of it has ultimate and dominant power. Bernanke needs to find a path for coordinated action when the time to remove the stimulus is at hand. –David R. Kotok, Cumberland Advisors
As Fed Governor Bernanke supported the flawed policies of Alan Greenspan — he never recognized the housing bubble or the lack of oversight — and there is no question, as Fed Chairman, Bernanke was slow to understand the credit and housing problems. And I’d prefer someone with better forecasting skills. However once Bernanke started to understand the problem, he was very effective at providing liquidity for the markets. The financial system faced both a liquidity and a solvency crisis, and it is the Fed’s role to provide appropriate liquidity. Bernanke met that challenge, and I think he is a solid choice for a 2nd term (not my first choice, but solid). –Calculated Risk
Maybe Obama realizes that the really hard part is only just beginning. Unwinding the vast expansion of the Fed’s balance sheet and figuring out how to tighten the screws on the money supply without plunging the country into an another economic contraction will be a tremendous challenge. Why saddle that grief on some up-and-coming Democratic economist? It’s Bernanke’s mess. Let him clean it up. –Andrew Leonard, Salon.com
[A] benefit of continuity is that it buys you room to maneuver. During the last several months, the Fed has massively expanded its role in the economy to keep credit flowing and prevent the financial system from seizing up. This is unquestionably a good thing… But one side effect has been to create a vocal reaction among bond traders (and their economist-sympathizers), who fear the moves will be inflationary and are constantly pressuring Bernanke to unwind these policies as soon as possible. Alas, doing so while the economy and financial system are so weak would be a horrible, self-defeating mistake–something Bernanke understands. But without Bernanke’s track record and credibility, a new chairman might have to start unwinding the Fed’s balance sheet much sooner to establish his/her anti-inflation bona fides. (Or, put differently, bond investors might actually start bidding up interest rates rather than just kvetching about inflation unless a new chairman sent a hawkish signal out of the gate.) Suffice it to say, the White House has very good reasons for wanting to avoid this outcome. –Noam Scheiber, The New Republic
Excellent decision. P.S. Don’t let this good news distract you from the much-less-good economic news on Tuesday: CBO and OMB are releasing new budget projections that will show trillions upon trillions of coming deficits. –Donald Marron
Game theory would have it this is the safe pick, the one that you cannot get into trouble for, even if things go bad later. A new Fed Chair, in the event something went awry down the road would lead bame back to the White House. –Barry Ritholtz, Fusion IQ