Who will replace Alan Greenspan?

Alan Greenspan's chairmanship of the Federal Reserve Bank officially comes to an end on January 31, 2006. The process of choosing a replacement has already begun, and investors have already begun to speculate as to who (he) will be. Two favorites have already emerged; both are prominent republicans and have served in the Council of Economic Advisors (CEA) under a Republican president. This is no coincidence, as president Bush will personally select the new chairman. The current front runner is Harvard economist Martin Feldstein. Feldstein has been an outspoken critic of the current administration's budget deficits, calling them "unsustainable." However, he has since abandoned this position, possibly to curry favor with President Bush. Ben Bernanke is currently second in line for the position. His calls for a more  transparent  monetary policy have earned him the respect of many economists and politicians. Business Week reports:

His stated preference for inflation targeting -- or shooting for an identifiable target range on inflation...risks asserting hard numbers over rationality, rendering him a risky choice for the Administration.

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