I think Bernanke is the smartest guy in the room

He let the new administration try their things, and then Ben got down to business, namely, Quantitative Easing:

It is cheaper and quicker than fiscal stimulus; this should have been our first move. It is more likely to work. There are two effects: lowering long-term interest rates and the helicopter drop of the cash. It belies previous talk of a liquidity trap.

Alas, there is no free lunch, as Tyler continues:

It does not address most of the underlying problems in the real economy and as you know I see the "sectoral shift" element of this downturn as very much underrated. In that sense don't expect too much. It shows that at the limit fiscal and monetary policy blur together. The more the Fed takes on its balance sheet, the more the long-run independence of the central bank is damaged. Monetizing so much government debt is what Third World nations do. Draining the new money from the system will someday be a problem. It may introduce a round of "beggar-thy-neighbor," central bank-engineered currency depreciations. ... If this fails the U.S. economy, and the stock market, will test new bottoms.

I've expressed confidence in Bernanke before. I don't know of a better candidate for Fed chair.

On the other hand, Jamie Dimon for Tim Geithner might be a good trade ...