The US Federal Reserve chairman holds considerable influence over the US economy, which is why many business leaders are keeping a close eye on whether Ben Bernanke, whose term as Fed chairman expires January 31st, will step down or whether President Barack Obama will even reappoint him to another term as chairman. (His term as a Fed board member does not expire until January 31st 2020.)
Obama hinted that Bernanke will choose to step down at the end of his current term as chairman.
In a recent poll of US CGMA designation holders, 88% of respondents said the individual chairman holds at least moderate influence over the US economy. Thirty-four per cent of respondents ranked the chairman’s influence as high.
“The Fed chief is like a quarterback, guiding strategy and initiating action,” James Blake, CPA, CGMA, CFO of Morey’s Piers & Beachfront Waterparks, said in a news release. “It’s a key role that can affect the moves of all the other players on the field. CGMA designation holders across the country are watching closely for any changes in the position so they and their companies can anticipate their next moves.”
More than one-third (34.5%) of US CGMA respondents in the survey hope the Fed will take measures to increase employment. Also, 19.3% want the central bank to let interest rates rise modestly; 17.1% want it to take steps to strengthen the US dollar; and 15.5% want it to keep inflation low.
More than half (58.2%) don’t expect the Fed to raise rates for at least a year; 27.3% expect the Fed to raise rates in the next six to 12 months.
The survey, which was conducted by email between May 16th and May 30th and included responses from 550 senior financial leaders with the CGMA designation, was part of the American Institute of CPAs Business & Industry Economic Outlook Survey.
Social media and the Fed
The survey also addressed the use of social media by the central bank.
Most CGMA respondents (61.7%) don’t think the Fed should make more effective use of social media for disclosures, even though the US Securities and Exchange Commission has issued new guidance on the use of social media channels for company disclosures. About one-third say the Fed should use both Facebook and Twitter for transparency and to increase awareness of its actions.
Related CGMA Magazine content:
“How Have CPAs Responded to Regulatory Overload?”: An increase in regulatory requirements in recent years has caused increased workloads for finance staff, a quarterly survey shows. Read how CPAs plan to address the issue.
“CPAs Expect Modest Difficulty Applying Revenue Recognition Standard”: Finance executives in the United States expect modest difficulty implementing the sweeping, global changes in revenue recognition that are coming their way.
—Neil Amato (namato@aicpa.org) is a CGMA Magazine senior editor.