Door number three

Fed front-runners can't yet rule out a dark horse

The front-runners to be chairman of the Federal Reserve may still need to see off a dark horse. Barack Obama last week alluded to the possibility that other candidates beyond Larry Summers and Janet Yellen are in the mix. It could just be some political jujitsu, but there are several other clearly qualified economists for the job. Who knows, maybe even Ben Bernanke could be persuaded to stick around.

The race has pretty clearly taken shape over the last month with White House insiders preferring Summers, the president's former economic adviser and onetime US Treasury secretary, and economists favoring Yellen, the Fed's vice-chairman. Yet the difficulty of getting Summers confirmed in the Senate and Yellen's distance from Obama's inner circle are becoming more pronounced issues.

The obvious hurdles, when combined with Obama's latest remarks, make it at least plausible to believe an unexpected nominee could turn up. For starters, the president is reported to already have name-checked Donald Kohn, a former vice chairman at the Fed, in a private meeting. A more likely contender would be another onetime vice chairman, Roger Ferguson. He advised the president's campaign and has served on some of his working groups. Ferguson also comes with market credibility, not least for having led one of the country's biggest retirement funds.

There are other longer shots, too. Austan Goolsbee, a Chicago Booth economist and former economic adviser close to the president, might hold some appeal. Like both Bernanke and Alan Greenspan, he served as chairman of the Council of Economic Advisers. So did Christina Romer, under Bill Clinton. Other outliers with the necessary credentials include Alan Blinder, yet another former Fed vice chairman, and William Dudley, president of the New York Fed.

Obama's best and easiest choice may be to convince Bernanke to stick around. No one on the shortlist can beat his experience. The market also probably would exhale with the status quo intact and the man who led the way into quantitative easing navigating the path back out. After eight exhausting years in the role, Bernanke may be the longest shot of them all. Don't entirely count him out yet, though.