Fed’s straight man

Ben’s got some explaining to do.

With the US dollar in a free fall, inflation at the pump and in the grocery aisle robbing consumers of their buying power and questions about America loosening its vise-like grip on the most powerful economy in the world, the country is expecting some straight talk today when Federal Reserve Chairman Ben Bernanke holds the first-ever central bank press conference.

At 2:15 p.m., Bernanke is expected to lift the Fed’s kimono a smidgen to give Americans a peek behind the typically secretive monetary regulator that has taken a beating over the past two years for being asleep at the wheel during the country’s worst economic crisis in a generation.

And more than that, Bernanke will try to shake the image that Fed bankers are worried mostly about Wall Street and are out of touch with Main Street. It was just last month that New York Fed President William Dudley was booed in Queens when he suggested inflation wasn’t happening because prices of electronics, such as an iPad, are dropping.

“How can you say inflation isn’t a concern when gas prices are at or near $4 a gallon and food prices have risen so sharply?” Gus Faucher, director of macroeconomics at Moody’s Analytics, asked.

So far, Bernanke has expressed the view that those rising prices aren’t a major concern at this point and is likely to hold the line on that view today despite economics experts that disagree. It’s a good thing he isn’t holding the presser in Queens.

The Fed’s policy over the past year of flooding the markets with some $600 billion in Treasuries in order to keep rates at 0.25 percent — an effort known as quantitative easing — also has come under fire among experts inside and outside the Fed.

Bernanke is likely to be peppered with questions about the effectiveness of his quantitative easing measures and its sequel QE2, which is expected to end in June with rumblings of a possible QE3 to follow.

“The price of energy is higher, the dollar is down. This is your plan?” queried Vincent Reinhart, former Federal Reserve Board official and resident scholar at the American Enterprise Institute.

Bernanke also will likely address issues about Standard & Poor’s threat of downgrading America’s credit rating from the pristine triple-A rating, Faucher noted.

Sources close to the Fed say that Bernanke is hoping to differentiate himself from his predecessors, like Alan Greenspan, on running the organization after it was granted even more power to regulate banks as a result of Dodd-Frank rules.

Some analysts believe that Bernanke may find his new openness in regards to monetary policy may do more harm than good.” Just because you are being transparent doesn’t mean you are providing clarity,” said Joseph LaVorgna, senior economist at Deutsche Bank.