Even at the time, everyone said he was paying too much, and so it has proved.Britain's new brain drain gathers paceIf you work in the vicinity of London's Canary Wharf, as I do, you could reasonably draw the conclusion that the whole world has come to work in Britain. Thames has also been a high-maintenance business, with RWE forced to invest a further £2bn in the London water mains on top.The then chief executive of RWE, Dietmar Kuhnt, matched Thames Water's all-time share price peak when he bought the business. But it does appear that RWE's chairman, Thomas Fischer, has decided which investment bank will get the mandate - step forward WestLB, where the chief executive just happens to be one Herr T Fischer.The plan, according to reports from Berlin, is to list about one-third of the water business initially, the rationale being that RWE could reinvest the proceeds more profitably in its gas and electricity division.A year after buying Thames, RWE swooped on npower, where it quickly discovered the opportunities for cross-selling electricity to water customers were limited, as was the scope for cost savings. The next phase of development may be a good deal less benign. In such circumstances, Mr Bernanke will struggle to emulate his predecessor, however good he is.RWE plans to float Thames WaterRWE is not the first company to discover that water and electricity do not mix and it probably won't be the last. Having splashed out £6.8bn on Thames Water five years ago and a further £4.2bn on American Water Works a year later, the German utility is now planning a partial sale of the two businesses through an initial public offering, almost certainly at a discount to the price it originally paid.It is not yet clear whether RWE Thames Water, as it is now known, will be refloated in London, New York or Frankfurt. Yet the real problem he's got is that Mr Greenspan was representative of a golden age of US economic expansion.
While serving as a member of the Fed's Open Markets Committee, it was he who advocated the use of "unconventional" policy action to counter the threat of deflation.It might also be possible to criticise him as too much of a Republican (but then so was Mr Greenspan) and perhaps insufficiently experienced of top policy jobs for such high office. By introducing a formal target, Mr Bernanke would dispense with the uncertainty and lack of transparency which surrounds US monetary policy.One criticism of Mr Bernanke is that he's too hung up on the risk of deflation - a obsession he apparently acquired through painstaking study of the Great Depression - and therefore insufficiently alert to cyclical bouts of inflation. In this he should be greatly assisted by his apparent belief in inflation targeting.Under Mr Greenspan, the Fed has had no formal inflation target. His approach has rather been one of "risk management", requiring a high degree of trust in his judgement on where the balance of risk in the economy lies - inflation or growth. Rebuilding the Fed's credibility as an institution, rather than as a personification of Mr Greenspan, must be one of Mr Bernanke's first priorities. He had become in every sense an icon.No one could readily step into these shoes, and indeed it is the abiding criticisms of Mr Greenspan that he had allowed the direction of US monetary policy to become so personalised.
A cult of personality has developed around the role, and there is an almost religious faith that comes from Mr Greenspan's longevity and wisdom in his ability to calm crises and do the right thing. With the US economy in such delicate shape, this was not the moment for a surprise, ill-qualified appointment. The starting point for thinking Mr Bernanke a sensible choice is that Mr Greenspan is in many respects an impossible act to follow. Over 18 years of generally faultless rule, Mr Greenspan has elevated the position of chairman of the Federal Reserve into a god-like status. Has he chosen well in Ben Bernanke, a career economist who has been heading up the President's Council of Economic Advisers? The proof will be in the eating, but by opting for the bookies' favourite, Mr Bush demonstrates that he hasn't yet entirely surrendered all sense of judgement. One buyer picked up 11.25 million shares, or a 5 per cent stake in the corporate jet operator, at 1.5p..
