Fed chairman Ben Bernanke responded to Senator Jim Bunning’s written questions posed as a part of the confirmation hearing. In responses to 70 questions ranging from the transparency of the Fed to the use of Tarp funds as capital, to the Fed’s agency debt purchase programme, Mr Bernanke restated his positions and defended his tenure as Fed chief.
He also sought to dampen concern on asset bubbles, saying there was “not much evidence to suggest that the stock market is currently in a bubble” and that “it is not clear [the gains in gold's price] have been out of line with fundamentals”. But then, his first reason for reticence in using monetary policy to lean against bubbles was that “we would have to be confident in our ability to detect bubbles at an early stage in their development.”
