Ben Bernanke, President Bush’s nominee to replace Alan Greenspan as chairman of the Federal Reserve Board, got a warm welcome on the market yesterday. The markets were up significantly indicating a general acceptance that Bernanke was a good choice (of course some good news on the earnings front didn’t hurt).

Bernanke, who must be confirmed by the Senate, promises to continue Greenspan’s tough stance against inflation. This “staying the course” means no surprises in the future and the market definitely responds well to the predictable.

The markets have good reason to fear inflation as this article points out.

Bernanke is chairman of the president’s council of economic advisers and a former Fed governor. He is a well-respected member of the academic community. The Senate will likely confirm him with little dissension. Greenspan’s term ends Jan. 31, 2006.