U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001

36–235 PDF 2007

S. HRG. 109–931

NOMINATIONS OF:

FREDERIC S. MISHKIN, LINDA MYSLIWY CONLIN,

J. JOSEPH GRANDMAISON,

EDMUND C. MOY, AND GEOFFREY S. BACINO

HEARING

BEFORE THE

COMMITTEE ON 

BANKING, HOUSING, AND URBAN AFFAIRS 

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

ON

NOMINATIONS OF:

FREDERIC S. MISHKIN, OF NEW YORK, TO BE A MEMBER, BOARD OF

GOVERNORS OF THE FEDERAL RESERVE SYSTEM

LINDA MYSLIWY CONLIN, OF NEW JERSEY, TO BE FIRST VICE PRESIDENT, 

EXPORT-IMPORT BANK OF THE UNITED STATES

J. JOSEPH GRANDMAISON, OF NEW HAMPSHIRE, TO BE A MEMBER OF THE

BOARD OF DIRECTORS, EXPORT-IMPORT BANK OF THE UNITED STATES

EDMUND C. MOY, OF WISCONSIN, TO BE DIRECTOR, U.S. MINT,

U.S. DEPARTMENT OF THE TREASURY

GEOFFREY S. BACINO, OF ILLINOIS, TO BE DIRECTOR,

FEDERAL HOUSING FINANCE BOARD

JULY 12, 2006

Printed for the use of the Committee on Banking, Housing, and Urban Affairs

(

Available at: http://www.access.gpo.gov/congress/senate/senate05sh.html 

COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS 

RICHARD C. SHELBY, Alabama, Chairman

ROBERT F. BENNETT, Utah 

WAYNE ALLARD, Colorado 

MICHAEL B. ENZI, Wyoming 

CHUCK HAGEL, Nebraska 

RICK SANTORUM, Pennsylvania 

JIM BUNNING, Kentucky 

MIKE CRAPO, Idaho 

JOHN E. SUNUNU, New Hampshire 

ELIZABETH DOLE, North Carolina 

MEL MARTINEZ, Florida 

PAUL S. SARBANES, Maryland 

CHRISTOPHER J. DODD, Connecticut 

TIM JOHNSON, South Dakota 

JACK REED, Rhode Island 

CHARLES E. SCHUMER, New York 

EVAN BAYH, Indiana 

THOMAS R. CARPER, Delaware 

DEBBIE STABENOW, Michigan 

ROBERT MENENDEZ, New Jersey

KATHLEEN L. CASEY, Staff Director and Counsel 

STEVEN B. HARRIS, Democratic Staff Director and Chief Counsel 

PEGGY R. KUHN, Senior Financial Economist 

MARK A. CALABRIA, Senior Professional Staff Member 

ANDREW OLMEM, Counsel 

JOHN EAST, Legislative Assistant 

STEPHEN R. KROLL, Democratic Special Counsel 

SARAH KLINE, Democratic Counsel 

LEE PRICE, Democratic Chief Economist 

JOSEPH R. KOLINSKI, Chief Clerk and Computer Systems Administrator 

GEORGE E. WHITTLE, Editor

(II)

CONTENTS

WEDNESDAY, JULY 12, 2006

Page

Opening statement of Chairman Shelby ................................................................ 1

Opening statements, comments, or prepared statements of: 

Senator Sarbanes .............................................................................................. 3

Senator Allard ................................................................................................... 5

Senator Dodd .................................................................................................... 6

Senator Sununu ................................................................................................ 7

Senator Menendez ............................................................................................ 8

NOMINEES 

Frederic S. Mishkin, of New York, to be a Member of the Federal Reserve 

System ................................................................................................................... 9

Biograpical sketch of nominee ......................................................................... 27

Response to written questions of Senator Bunning ....................................... 87

Linda Mysliwy Conlin, of New Jersey, to be First Vice President, the ExportImport Bank of the United States ...................................................................... 10

Prepared statement .......................................................................................... 51

Biograpical sketch of nominee ......................................................................... 52

J. Joseph Grandmaison, of New Hampshire, to be a Member of the Board 

of Directors of the Export-Import Bank of the United States .......................... 11

Biograpical sketch of nominee ......................................................................... 60

Edmund C. Moy, of Wisconsin, to be Director, the U.S. Mint, U.S. Department 

of the Treasury ..................................................................................................... 12

Prepared statement .......................................................................................... 59

Biograpical sketch of nominee ......................................................................... 71

Geoffrey S. Bacino, of Illinois, to be a Director of the Federal Housing Finance 

Board ..................................................................................................................... 13

Biograpical sketch of nominee ......................................................................... 79

(III)

(1)

NOMINATIONS OF: 

FREDERIC S. MISHKIN, OF NEW YORK,

TO BE A MEMBER OF THE FEDERAL RESERVE SYSTEM 

LINDA MYSLIWY CONLIN, OF NEW JERSEY,

TO BE FIRST VICE PRESIDENT 

J. JOSEPH GRANDMAISON, OF NEW HAMPSHIRE,

TO BE A MEMBER OF THE BOARD OF DIRECTORS OF

THE EXPORT-IMPORT BANK OF THE UNITED STATES 

EDMUND C. MOY, OF WISCONSIN,

TO BE DIRECTOR, THE U.S. MINT

U.S. DEPARTMENT OF THE TREASURY AND 

GEOFFREY S. BACINO, OF ILLINOIS,

TO BE A DIRECTOR OF

THE FEDERAL HOUSING FINANCE BOARD 

WEDNESDAY, JULY 12, 2006

U.S. SENATE, 

COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, 

Washington, DC. 

The Committee met at 10:40 a.m., in room SD–538, Dirksen Senate Office Building, Senator Richard Shelby (Chairman of the Committee) presiding. 

OPENING STATEMENT OF CHAIRMAN RICHARD C. SHELBY 

Chairman SHELBY. The hearing will come to order. 

This morning, we will consider several nominations. I appreciate 

the willingness of the nominees to appear before the Committee 

this morning. 

This panel of nominees, if confirmed, will have important responsibilities for overseeing our Nation’s financial institutions, payments systems, housing and community development finance, and 

export trade financing. 

Our first nominee is Frederic Mishkin, of New York, who was 

nominated to serve as a Member of the Board of Governors of the 

Federal Reserve System. If confirmed by the Senate, Mr. Mishkin 

would fill the seat vacated by Roger Ferguson in April and serve 

the remainder of the 14-year term expiring in January 2014. Dr. 

Mishkin has served the Federal Reserve System in several capacities. From 1994 to 1997, he headed the Research Department of 

2

the Federal Reserve Bank of New York and has served as a consultant. He was also an economist with the Board of Governors 

early in his career. Currently, Dr. Mishkin is the Alfred Lerner 

Professor of Banking and Financial Institutions at the Graduate 

School of Business, Columbia University, as well as a Research Associate at the National Bureau of Economic Research; a Senior Fellow at the FDIC Center for Banking Research, too. 

Dr. Mishkin has extensive experience with central banks around 

the globe, having held positions with the Ministry of Finance in 

Japan, the Reserve Bank of Australia, the Financial Supervisory 

Service of South Korea, the Bank of England, the International 

Monetary Fund, and the World Bank. 

Since receiving his Ph.D. from the Massachusetts Institute of 

Technology in 1976, Dr. Mishkin has taught at the University of 

Chicago, Northwestern University, Princeton University, and Columbia University, with which he has been affiliated since 1983. 

Dr. Mishkin’s research focuses on the effects of monetary policy on 

financial markets and the economy, a particularly useful area of 

expertise for a Governor at the Federal Reserve. 

A few years ago, Dr. Mishkin wrote ‘‘Inflation Targeting: Lessons 

from the International Experience’’ with Chairman Bernanke, who 

now serves as the Chairman of the Fed, as we know. 

We also have two nominees with us this morning who have been 

nominated to very important positions outside the Fed, the U.S. 

Export-Import Bank: Ms. Linda Mysliwy Conlin, of New Jersey, 

who has been nominated to serve as First Vice President of the 

Bank; and Joseph Grandmaison, of New Hampshire, who has been 

nominated to the Bank’s Board of Directors. 

Ms. Conlin presently serves as a Member of the Board of Directors of the Export-Import Bank, a position she has held since 2004. 

Prior to joining the Bank, Ms. Conlin was Assistant Secretary for 

Trade Development at the U.S. Department of Commerce from 

2001 to 2004. She has also served as Director for Travel and Tourism at the New Jersey Commerce and Economic Growth Commission from 1994 to 1999, as Assistant Secretary for Tourism and 

Marketing at the U.S. Department of Commerce from 1989 to 1993, 

and as an Associate Director at the U.S. Information Agency from 

1986 to 1989. Ms. Conlin holds an undergraduate degrees from the 

University of Massachusetts and completed graduate studies at Indiana University. 

Mr. Joseph Grandmaison, nominated to the Board of Directors of 

the Export-Import Bank, previously served as Director of the ExIm Bank from 2001 to 2005. He served as Director of the U.S. 

Trade and Development Agency from 1993 to 2001 and as an adjunct professor at the College of Communications at Boston University. He is a graduate of the Kennedy School of Government at 

Harvard University and Burdett College. 

Our fourth nominee, Geoffrey Bacino, of Illinois, is President 

Bush’s nominee to the Federal Housing Finance Board. If confirmed, he will fill the vacant Board seat held by Franz Leichter. 

Mr. Bacino is currently Senior Vice President of Legislative and 

Regulatory Affairs at Centrix Financial, a firm specializing in the 

subprime auto loan market and serving more than 180 credit 

unions nationally. Previously, he was president of his own firm, a 

3

law firm headquartered in Washington, DC. President Clinton 

nominated him to the Board of the National Credit Union Administration where he served from 2000 to 2001. He was co-founder of 

the National Association of State Chartered Credit Unions and 

served as Executive Director of the National Association of Share 

Insurance Corporations. He received his undergraduate degree in 

political science from Indiana University. 

Our final nominee today is Mr. Edmund C. Moy, of Wisconsin, 

who has been nominated to serve as Director of the U.S. Mint, one 

of our oldest and most venerable institutions. Mr. Moy currently 

serves as Special Assistant to the President for Presidential Personnel at the White House. Previously, he worked with venture 

capitalist firms and entrepreneurs and served on the boards of several companies and nonprofit organizations. He served in the Administration of President George H.W. Bush at the Federal Health 

Care Financing Administration. If confirmed, Mr. Moy will replace 

Henrietta Holsman Fore, whom President Bush nominated to be 

Under Secretary of State for Management. Mr. Moy graduated 

from the University of Wisconsin with a triple major in economics, 

international relations, and political science. 

I welcome all of you here this morning. 

Senator Sarbanes. 

STATEMENT OF SENATOR PAUL S. SARBANES 

Senator SARBANES. Thank you very much, Mr. Chairman, and I 

am pleased to join with you in trying to move the President’s nominees forward through the nomination process. I think just as a 

basic requisite, we need an efficient appointment and confirmation 

process so that able appointees can assume the varied responsibilities for which they have been selected, and I think this Committee 

over the years has had a very good record in that regard. Occasionally, we have someone we feel maybe is not up to standard, and 

that obviously calls for a different kind of hearing. But I am 

pleased to say that, looking over these papers here this morning, 

I am looking forward to moving these nominees ahead as promptly 

as we can. 

I hold public service in high esteem, and I congratulate all of our 

nominees. We appreciate their willingness to serve the country. 

I will be very quick because I know you want to get to them, but 

I just want to mention a couple of points. 

First of all, I want to welcome Professor Mishkin. He has had a 

distinguished academic career, including serving as the Research 

Director of the Federal Reserve Bank of New York and as a leading 

authority on U.S. and foreign monetary policy. He has been a consultant overseas to a number of central banks and other countries. 

I just want to underscore—and I may get to it in the question 

period if time permits—that the Fed has a dual mandate: Maximum employment and stable prices. For the last 3 months, jobs 

have grown at a sluggish pace, 108,000 this last month. This is in 

a period where we have had slower job growth than has been typical of past expansions, combined with falling real wages. 

The issue of inflation targeting has been raised. I do not quite 

know why at this particular juncture this issue has been introduced into the discussion, and Professor Mishkin has—one of the 

4

problems with being a distinguished professor like Fred Mishkin is 

you have a lot of writings that people can make reference to. 

Chairman SHELBY. A lot of good questions. 

[Laughter.] 

Senator SARBANES. My concern, as I expressed it when we had 

the Bernanke hearing, is that inflation targeting carries with it, I 

think, the serious risk of slighting one side of the Fed’s dual mandate. I do want to observe that the mandate of the Fed is established by the Congress by statute, not by the Fed. The Fed does 

not have a wide-open blank check to write its own mandate. And 

the statute has the dual mandate in it, and I for one will keep an 

eye on maintaining that dual mandate. 

The other is that we need to discuss the Basel II capital requirements, and I think that is a major issue. 

Chairman SHELBY. Absolutely. I brought it up yesterday. 

Senator SARBANES. Actually, Basel II had the initial goal of improving incentives for banks engaging in complex financial transactions to control risk without markedly lowering capital requirements. They moved ahead on an international agreement for Basel 

II before a careful quantitative impact study of what implementation would mean for the required level of buying capital had been 

undertaken. When that study came along, called QIS–IV, it found 

that the Basel rules would lower the required bank capital for half 

of the participating U.S. institutions by at least 25 percent. One institution had a capital reduction of just shy of 50 percent. And aggregate capital declined over 15 percent. 

Actually, Professor Mishkin’s own research has shown the importance of capital requirements when economic hard times come 

along, both here and abroad, and we need to proceed in a prudent 

way on this Basel II. And, actually this Committee has been raising that issue time and time again. 

Chairman SHELBY. Absolutely. 

Senator SARBANES. And I think it is an important matter. 

I want to welcome the two nominees for the Export-Import Bank. 

The Bank finances U.S. exports in cases in which commercial financing might not be available or where sales might not otherwise 

occur in order to create U.S. jobs. That is the charge for the Bank, 

and I want to underscore that. 

Ms. Conlin is now serving as a Board Member. She has been 

nominated now to become Vice Chairman of the Board. She is 

former Assistant Secretary of the Department of Commerce for 

Trade Development. She has been on the Board of the Bank now 

for, I guess, a couple of years, if I am not mistaken. We look forward to her becoming the Vice Chair. 

And, of course, Joe Grandmaison is a veteran of the trade area 

of our policy, Director of the U.S. Trade and Development Agency, 

and he has been on the Board, well, from 2001 to 2005 and has 

now been renominated for another term. We look forward to his 

continued service. 

I hope, Mr. Chairman, we can move Mr. Grandmaison, Ms. 

Conlin, and Jim Lambright through pretty quickly so the Board 

gets—I would note there is still one vacancy on the Board, and I 

urge the Administration to send another nominee so we can get the 

Board up to full strength, particularly as we consider its reauthorVerDate 0ct 09 2002 16:33 Jul 06, 2007 Jkt 000000 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 S:\DOCS\36235.TXT SBANK4 PsN: KEVIN
5

ization, which is an issue that we have to deal with in the next few 

months. 

Mr. Moy, you have a big assignment to be the Director of the 

Mint. It is the largest coin manufacturer in the world, and it is a 

big administrative job, and so it is a real challenge, although you 

have done important administrative work in the past, and I know 

you have now been working closely with President Bush in Presidential Personnel. 

I do not see your nomination here to be the Director of the Mint 

as analogous to Dick Cheney becoming the Vice Presidential candidate. 

[Laughter.] 

He was in charge of finding the candidates, and it ended up he 

was the candidate. And Mr. Moy has been in charge in Presidential 

Personnel, and here he is nominated. 

Chairman SHELBY. Maybe Mr. Moy found a good candidate here. 

[Laughter.] 

He found the best candidate. We hope so. 

Mr. MOY. Purely coincidental. 

Chairman SHELBY. We hope you are the best candidate. We believe you are well-qualified. 

Senator SARBANES. Mr. Bacino, we welcome you before the Committee. You have serious corporate governance and risk management problems at several of the Federal Home Loan Banks. We 

may ask you a bit about that, if time permits, and, you know, the 

Federal Home Loan Banks have assets totaling almost $1 trillion. 

They are one of the world’s largest issuers of debt. We are concerned about some of the practices at some of the Federal Home 

Loan Banks, and, of course, once you go on the Board, you will 

have a major responsibility for that. 

Thank you very much, Mr. Chairman. 

Chairman SHELBY. Senator Allard. 

STATEMENT OF SENATOR WAYNE ALLARD 

Senator ALLARD. First of all, Mr. Chairman, I want to thank you 

for holding this hearing today. We have some very important nominations for consideration before us. I look forward to hearing their 

testimony and having the opportunity to discuss issues related to 

their agencies. 

First, I would like to welcome all of you to the Banking Committee. Dr. Mishkin, monetary policy is an important issue to this 

Committee, to the Senate, and to the country. You have a big job 

ahead of you upon confirmation, but I am sure you are aware of 

this already. And there are many important issues facing our economy, and I am eager to discuss a few items with you. 

Ms. Conlin and Mr. Grandmaison, your previous experience at 

the Export-Import Bank obviously makes you well-qualified to continue serving. I look forward to hearing your thoughts on the 

Bank’s reauthorization. 

I would like to take this opportunity to express my disappointment that the Bank still does not have an Inspector General. I was 

frustrated that although an Inspector General was authorized in 

2002, Congress failed to appropriate the necessary money until last 

year. However, I would note that the Senate included funding in 

6

each of those years. The appropriations bill containing the Inspector General funding was signed into law last November, 8 months 

ago, yet the White House has still failed to come forward with a 

nominee. It will become increasingly difficult to support nominees 

for the Export-Import Bank while the White House leaves what I 

consider to be an equally important position, the Inspector General, 

vacant. Ms. Conlin and Mr. Grandmaison, I would hope that you 

would use your positions to help pressure the Administration to 

move quickly on this critical vacancy. 

Mr. Bacino, we appreciate your willingness to serve on the Federal Housing Finance Board, particularly when there are a number 

of us that are looking forward to the day when we would actually 

eliminate the Board. Your point of view will be helpful to the Committee as we continue our attempts to create a new regulator for 

the housing GSE’s. 

Mr. Moy, it is nice to see you in front of the Committee as well. 

As you already know, Denver is proud to be the home of a Mint 

facility. The Denver Mint is one of only two Mints in the United 

States that produce coinage for circulation. I am sure that if you 

are confirmed, we will be working together in the future. 

Again, thank you, Mr. Chairman, for holding this hearing today, 

and I look forward to hearing from our witnesses. 

Chairman SHELBY. Thank you, Senator Allard. 

Senator Dodd. 

STATEMENT OF SENATOR CHRISTOPHER J. DODD 

Senator DODD. Mr. Chairman, I will be very brief. You, Senator 

Sarbanes, and Senator Allard covered the ground pretty well here. 

Let me congratulate all of you on being nominated and for your 

willingness to serve in these important positions and roles. 

I am particularly interested, as you know, Mr. Chairman, in the 

Export-Import Bank and the fact that we have had an incomplete 

board for too long a time, and that is putting that institution in a 

very precarious situation. 

Chairman SHELBY. You know a lot about that Board. 

Senator DODD. I know a lot about that Board. Truth in advertising here, my wife is a former Vice Chairman of the Board, and 

so I have a great familiarity with it and a great respect for it. The 

point that Senator Sarbanes made—

Senator SARBANES. You have huge shoes to fill. 

[Laughter.] 

Senator DODD. I did not say that, Ms. Conlin. Senator Sarbanes 

said that. 

Ms. CONLIN. I understand. 

Senator DODD. But the role of the Bank, since its charter in 

1934, in fact, it almost should be called, ‘‘the Export Bank.’’ The 

import side of it, I do not know why that name is even in the title. 

I guess originally they thought more about the import aspects of 

all of this. But the job creation in this country as a result, particularly with smaller businesses, I must say, going back to people like 

Ken Brody and others in the past who really expanded that role. 

Historically, in fact, there were major corporations that took advantage of it, and under new leadership over the last several years, we 

have watched the Bank expand its operations to really reach out 

7

to smaller enterprises in the country that have really increased job 

opportunities here at home and created opportunities for the 

United States in these businesses overseas. And I just want to commend him. Joe has done a great job here, and I am delighted you 

are willing to do this again, Joe. 

As Paul pointed out correctly, you bring a wealth of experience 

to this job. You have been there a long time. You know it well. Ms. 

Conlin, you now have several years there as well. We are still missing one member, as Senator Sarbanes points out, and I hope the 

Administration would send up a nominee and, Mr. Chairman, we 

could move quickly on it so we would have the full five-member 

complement of the Board there to function and operate. 

But this is great news to have a quorum now that can be 

achieved and really give great legal authority to the decisions the 

Board makes and not raise questions about whether or not they are 

adequate. 

So, I commend you both, and particularly my relationship with 

Joe goes back a long time. I am grateful to you, Joe, for doing this 

again. 

To the other members, I am interested in your testimony and 

some questions will be raised appropriately, with congratulations 

on your willingness to serve. 

Thank you, Mr. Chairman. 

Chairman SHELBY. Senator Sununu. 

STATEMENT OF SENATOR JOHN E. SUNUNU 

Senator SUNUNU. Thank you, Mr. Chairman. I welcome all the 

nominees, and I do want to offer a special welcome to a good friend, 

Joe Grandmaison, or as his friends on the west side of Manchester 

would say, ‘‘Joe Grand-may-sohn.’’ We have a long friendship, although Senator Dodd is much, much older than I am. 

[Laughter.] 

Your friendship may actually go back even a little bit further. 

Senator DODD. He is going to learn eventually how this works. 

[Laughter.] 

Senator SUNUNU. Actually, Mr. Moy, Senator Dodd gave me what 

may be the best advice I have received in the Banking Committee 

so far, and that is, do one coin bill and do only one coin bill. 

[Laughter.] 

And I look forward to working with you on that, on the implementation of the dollar coin bill, which is now the law of the land. 

But Joe really is, in addition to an experienced individual along 

the lines described by the Chairman and Senator Sarbanes, a great 

public servant, and I think that needs to be emphasized, because 

that is the kind of individual and experience we look for in any of 

these Presidential appointees, going back to his National Guard 

service as a young man and working as a one-time alderman in the 

city of Nashua, and New Hampshire local politics is by far the 

toughest job there is. He has been a delegate to the New Hampshire Constitutional Convention, which is taken very seriously in 

a State like New Hampshire, and, of course, as was mentioned, his 

work at U.S. Trade and Development and his previous work as a 

Board member at the Bank all has made the people of New Hampshire very proud of the work that he has done here. 

8

He also has private sector experience, and, in particular, I think 

that is why he has been such a great advocate for the small and 

medium-sized businesses that Senator Dodd mentioned. He has 

been a great voice for them at the Bank. 

I will close by noting that my staff has indicated that 6 weeks 

ago Joe called at about 8 o’clock in the morning and spent an hour 

and a half just chatting about things the Bank and its work and 

his thoughts about the economy and business and how Ex-Im 

might continue to make a bit of a difference in that area. And that 

is an indication of one of two things: Either he loves my staff, or 

he loves the Ex-Im Bank. And my sense it is a little bit of both because my staff has really enjoyed working with him as well and 

with this nomination and his confirmation, and I look forward to 

many more years. 

Thank you, Mr. Chairman. 

Senator SARBANES. What are we to make of the fact that he 

called at 8 a.m. in the morning in order to have that chat? 

Chairman SHELBY. He is up early working for jobs. 

Senator SUNUNU. Well, a good sign there is that he knew my 

staff would be in, so that is a credit to both parties. 

Chairman SHELBY. Senator Menendez. 

STATEMENT OF SENATOR ROBERT MENENDEZ 

Senator MENENDEZ. Thank you, Mr. Chairman. I want to congratulate all the nominees on their nomination by the President. 

Mr. Bacino, I actually hope that you will have a long-term engagement. I think there is still a role for the Federal Home Loan 

Bank, and as I talk to bankers not only in my State but also across 

the country, they tell me that there is still a need for them and a 

real opportunity to create homeownership as part of the reality 

that we want for as many Americans as possible. So, I hope you 

have a long-term engagement. 

I appreciate the assignments that all of the nominees will have. 

I particularly want to share Senator Dodd’s comments about the 

Export-Import Bank, and I know we have two excellent nominees 

there. I hope to work with both of you, particularly from a State 

that is still looking to enhance the opportunity from New Jersey, 

to enhance the opportunity to get many more small and mid-sized 

businesses into this global marketplace and to enhance those who 

are in it already. 

Part of our challenge in trade as we take trade votes is to have 

the connection to people in their everyday lives become more and 

more real, and that means being able to have more and more people benefit, whether by employment or by expansion of businesses 

in that regard. And it makes these trade issues a lot more easy. 

And so we hope that as we look at a variety of new initiatives in 

New Jersey, creating something we call the ‘‘Liberty Corridor,’’ a 

place to go from idea to marketplace and do everything in between, 

that we will be able to work with both of you in promotion of those 

opportunities. 

We appreciate Mr. Grandmaison. When I was in the House, we 

often had the opportunity before the International Relations Committee, looking at some of those issues, and we appreciate your 

great expertise, and we are honored that a New Jerseyan has been 

9

designated to be the First Vice President of the Bank. And, Ms. 

Conlin, with your background, I know it is going to further enhance 

the Bank’s capabilities, and we look forward to having your specific 

insights, as it relates to your history in New Jersey as well, be an 

asset. 

So, with that, Mr. Chairman, I look forward to being supportive, 

and thank you for the opportunity. 

Chairman SHELBY. Would all of you stand and be sworn? Hold 

up your right hand. Do you swear or affirm that the testimony that 

you are about to give is the truth, the whole truth, and nothing but 

the truth, so help you God? 

Mr. MISHKIN. I do. 

Ms. CONLIN. I do. 

Mr. GRANDMAISON. I do. 

Mr. MOY. I do. 

Mr. BACINO. I do. 

Chairman SHELBY. Do you agree to appear and testify before any 

duly-constituted committee of the U.S. Senate? 

Mr. MISHKIN. I do. 

Ms. CONLIN. I do. 

Mr. GRANDMAISON. I do. 

Mr. MOY. I do. 

Mr. BACINO. I do. 

Chairman SHELBY. Thank you. 

All of your written testimony will be made part of the hearing 

record in its entirety, and, Dr. Mishkin, we will start with you, if 

you will just sum up briefly, because we have got a big panel. 

STATEMENT OF FREDERIC S. MISHKIN, OF NEW YORK,

TO BE A MEMBER,

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM 

Mr. MISHKIN. Chairman Shelby, Senator Sarbanes, and Members 

of the Committee, I am honored to have been nominated by President Bush to serve as a member of the Board of Governors of the 

Federal Reserve System. I thank you for the opportunity to appear 

today and for the expeditious scheduling of the hearing. 

After receiving my Bachelor of Science in Economics from MIT 

in 1973, I went on to earn my Ph.D. in economics from the same 

institution in 1976. I have been a Professor at the University of 

Chicago, Northwestern University, Princeton University, and, since 

1983, have been a Professor at the Graduate School of Business, 

Columbia University. My research has focused on monetary policy 

and the financial system, and I am the author of more than 100 

professional articles and more than 10 books on these topics. I currently as a research associate of the National Bureau of Economic 

Research, serve on six editorial boards of academic journals, and 

have been a past President of the Eastern Economic Association. 

In addition to my academic background, I also have substantial 

policy experience. From 1994 to 1997, I was an Executive Vice 

President and Director of Research at the Federal Reserve Bank of 

New York and, in that capacity, attended Federal Open Market 

Committee meetings on a regular basis. I continue to be a consultant to the Federal Reserve Bank of New York and currently am a 

member of its Economic Advisory Panel. I also have consulted for 

10

numerous central banks throughout the world, as well as for the 

World Bank and the International Monetary Fund. 

As Members of this Committee know, Congress has assigned to 

the Federal Reserve considerable responsibilities, among which are: 

Fostering price stability while maintaining maximum sustainable 

employment; promoting a safe and sound banking and a stable and 

efficient payments system; and promoting financial literacy and 

fair dealing for consumers. If confirmed by the Senate, working 

with Chairman Bernanke and my fellow Board members, I will do 

my utmost to fulfill these responsibilities. I believe that my experience as a scholar whose research has focused on issues of direct 

concern to central banks and my prior experience within the Federal Reserve System will enable me to substantially contribute to 

the operations of the Federal Reserve System. 

I look forward to responding to your questions. Thank you very 

much. 

Chairman SHELBY. Ms. Conlin. 

STATEMENT OF LINDA MYSLIWY CONLIN, OF NEW JERSEY,

TO BE FIRST VICE PRESIDENT,

EXPORT-IMPORT BANK OF THE UNITED STATES 

Ms. CONLIN. Mr. Chairman, Senator Sarbanes, distinguished 

Members of the Committee, I am pleased to come before you today 

as the President’s nominee to become First Vice President of the 

Export-Import Bank of the United States. I appreciate the confidence that the President has placed in me, and I am grateful for 

another opportunity to contribute to an institution where I have 

had the privilege to serve these past 2 years. 

If confirmed, I look forward to working with the members and 

staff of the Committee to help sustain and increase the number of 

high-paying U.S. jobs by financing export transactions that otherwise would not go forward. 

I would like to recognize my husband, Joe, and my dear friend, 

Louise Wheeler, who are both with me here today, and the fine 

team from Ex-Im Bank. 

Chairman SHELBY. Do you want them to stand up? 

Ms. CONLIN. Stand up, please. Or a slight wave. He is so tall, a 

slight wave would do. 

[Laughter.] 

It was not that long ago on February 26, 2004, that I came before 

the Committee as the President’s nominee to be a Director of the 

Export-Import Bank. Since that time, I have endeavored to honor 

the confidence that you have placed in me and the commitment I 

made to you: Simply stated, to ensure that U.S. exporters have the 

financing tools they need to succeed in today’s highly competitive 

global economy. 

As a Board member, I have been given the responsibility of overseeing a key Congressional mandate: Increasing the Bank’s financing of environmentally beneficial goods and services, including renewable energy. We continue to make a difference in that area. ExIm Bank has supported more than $1.1 billion of U.S. exports of 

environmentally beneficial goods and services over the past 4 

years. And in this regard, it has been personally gratifying for me 

to work with the Bank’s Environmental Exports Team, a group of 

11

enthusiastic and dedicated professionals from various departments 

who have helped implement this program. 

As a former small business owner, I am also pleased to be working with the many small and medium-sized companies that make 

up the lion’s share of the U.S. environmental sector. These entrepreneurs serve as the backbone of the American economy, and their 

risk-taking fuels our free market system. I want to do everything 

to help them to grow. A key to that growth is Ex-Im financing that 

can help shoulder the risk of opening up new markets overseas. 

I have personally witnessed the positive results of the Bank’s expanded small business program over the past year. Assuming that 

the Bank is provided sufficient administrative resources going forward, I firmly believe that the Bank’s efforts focused on small businesses will continue to grow. I, therefore, welcome the opportunity 

to assist Acting Chairman Jim Lambright in helping these companies succeed in the global marketplace. 

It has also been my pleasure to work with Ex-Im’s Sub-Saharan 

Africa Advisory Committee and the business development team to 

increase financing in that region, building upon the hard work and 

success of my former colleague and Ex-Im Board Member-Designate, Joe Grandmaison. I am pleased to say that we are now implementing many of the Advisory Committee’s recommendations. 

If confirmed as First Vice President, I will use my experience 

both at Ex-Im Bank and in trade development at the U.S. Department of Commerce to leverage the resources of Federal agencies 

and industry organizations to accomplish our shared goals. 

I welcome the opportunity to work with Ex-Im Bank’s Chairman 

and executive leadership and the talented professional staff at the 

Bank to ensure that Ex-Im Bank’s programs and policies remain 

competitive. 

Mr. Chairman, Senator Sarbanes, Members of the Committee, I 

respectfully ask for your favorable consideration of my nomination, 

and I will be pleased to respond to your questions. 

Chairman SHELBY. Mr. Grandmaison. 

STATEMENT OF J. JOSEPH GRANDMAISON,

OF NEW HAMPSHIRE,

TO BE A MEMBER OF THE BOARD OF DIRECTORS,

EXPORT-IMPORT BANK OF THE UNITED STATES 

Mr. GRANDMAISON. Mr. Chairman, Members of the Committee, I 

am honored to once again appear before you today as the President’s nominee to be reappointed as a member of the Board of Directors at the Export-Import Bank. 

I am deeply appreciative to President Bush for giving me the opportunity to continue in public service. I am also most appreciative 

to Majority Leader Reid, Senator Sarbanes, and Senator Dodd for 

their support of my renomination. 

I would also like to thank Senator Sununu for saying generous 

words about me. I was a little worried given that he mentioned he 

had reviewed my contributor list. 

[Laughter.] 

But as a New Hampshire Democrat, as you would expect, there 

happen to be a lot of Democrats that I supported. A few of them 

have been successful. 

12

You can be assured that, if confirmed, I will continue to serve 

with the same dedication, zeal, and purposefulness as I have in my 

previous Government service at the Bank and at the U.S. Trade 

and Development Agency. 

As we all know, what with reauthorization, this is an especially 

important year for the Bank. While my term ended prior to discussions having begun relative to reauthorization, be assured that I 

have followed the debate as well as having attended three of the 

Congressional hearings. I am aware of the concerns expressed by 

several Senators and Members of the House and, if confirmed, will 

reflect those concerns in my voice and in my vote. 

Ex-Im Bank is all about creating U.S. jobs in this ever-changing 

world marketplace. I welcome the opportunity to continue to work 

with you toward that end and ask for your support and would obviously welcome any questions you might have. 

Thank you. 

Chairman SHELBY. Mr. Moy. 

STATEMENT OF EDMUND C. MOY, OF WISCONSIN,

TO BE DIRECTOR, U.S. MINT

U.S. DEPARTMENT OF THE TREASURY 

Mr. MOY. Chairman Shelby, Senator Sarbanes, Members of the 

Committee, thank you for the opportunity to appear before you 

today to discuss my nomination to become the 38th Director of the 

U.S. Mint. 

Joining me today is my wife, Karen, and without her support and 

love and partnership, I would not be here today. So thank you. 

I am pleased and honored by the trust that President Bush has 

placed in me by asking me to serve in this important position, and 

I recognize that, if confirmed, I will join the ranks of those privileged to be Directors since President Washington asked David Rittenhouse to become the first Mint Director in 1792. 

The background that I bring I think will be extremely helpful to 

the Mint at this point of its history. I have 10 years as a sales and 

marketing and branding executive with a major corporation, 8 

years working with venture capital firms, creating value. I have 

had Federal Government experience managing a fairly sizable staff 

at the Department of Health and Human Services, overseeing $7 

billion of annual Federal expenditures, and being in Presidential 

Personnel, I certainly understand the human resources component 

of what I am about to do. 

If confirmed, there are a couple immediate priorities that I see 

myself focusing on. Most important is implementing the Presidential $1 Coin Act, which this Committee has approved. The second is providing information to Congress on dealing with the rising 

costs of producing coins, as you have read with the penny and the 

nickel. And, finally, reviewing and, if necessary, refining all the 

various business plans and operational plans that the Mint has, because some of the environment has changed since those original 

plans were developed. 

Thank you for the honor and privilege of appearing before you 

today. 

Chairman SHELBY. Thank you, sir. 

Mr. Bacino. 

13

STATEMENT OF GEOFFREY S. BACINO, OF ILLINOIS,

TO BE DIRECTOR, FEDERAL HOUSING FINANCE BOARD 

Mr. BACINO. Thank you. Senator Shelby, Ranking Member Sarbanes, and Members of the Committee, I, too, want to thank you 

for the opportunity to appear before you today and for the expeditious scheduling of this hearing. I would also like to express my 

thanks to President Bush for nominating me and to Minority Leader Reid for recommending me for the position of Board member at 

the Federal Housing Finance Board. If confirmed, I will work to the 

utmost of my abilities to fulfill the responsibilities of this office. 

With me today, I would also like to thank my wife, Nathalie, and 

my oldest daughter, Evan. 

A major component of the American Dream has been and should 

continue to be homeownership. With the involvement of the Federal Home Loan Banks and the mortgage lending process, the 

Housing Board and its oversight of this important purchase remain 

an integral part of the process. 

Having previously served as a Federal regulator for credit unions 

as a Board member at the National Credit Union Administration, 

I understand the need for a reasonable and rational regulator. During my time at NCUA, the Board advanced a regulatory framework 

where ‘‘one size fits all’’ gave way to a more progressive approach 

that took into account the capabilities of each institution. 

I often equate being a good regulator with the same qualities as 

being a good umpire. It is not the umpire’s job to tell the manager 

who to start, when to change pitchers, or whether to hit and run. 

It is, however, the umpire’s job to decide if a ball is a ball or a 

strike, decide if it is fair or foul, and if a runner is out or safe. Although the umpire is not playing the game, his role is essential to 

ensuring the integrity of the game. 

And so it is with a regulator. As the Federal Home Loan Banks 

continue on a daily basis to uphold their mission and commitment 

to help meet community housing and lending needs, the integrity 

in that process is essential. Integrity in the safety and soundness 

of the Federal Home Loan Bank system, integrity in their role in 

the capital markets. An effective regulator helps create an environment in which that integrity is ensured. 

Let me conclude by saying I look forward to working with this 

Committee and its counterpart on the House side as we address 

important housing and finance issues in the years to come through 

the Federal Home Loan Bank system. 

Thank you very much. 

Chairman SHELBY. Thank you. 

I will start with you, Dr. Mishkin. Your research and writing 

suggests that you are a proponent of inflation targeting. What are 

your views on whether the FOMC should adopt an explicit inflation-targeting regime? Would you say, for example, that the Federal Reserve under Alan Greenspan implicitly practiced inflation 

targeting? 

Mr. MISHKIN. First of all, the law of the land is that the Federal 

Reserve has a dual mandate: Not only is it supposed to preserve 

price stability, but it is also supposed to get maximum employment. 

14

This is clearly what the Federal Reserve was doing under Chairman Greenspan. I think it is definitely what the Federal Reserve 

should be doing in the future. 

The benefits of inflation targeting have actually been very similar to the benefits that were pursued under the Greenspan Fed and 

now under Chairman Bernanke’s Federal Reserve in that the view 

that price stability is very critical to the economy—that you anchor 

inflation expectations—is, in fact, a good way to not only control inflation but also to produce maximum sustainable employment. 

Any decisions about what will happen in the future—that I will 

be participating in, that what is appropriate in terms of the form 

of the Federal Reserve policymaking—is something that has to be 

deliberated on. Moving from an academic to a policymaker means 

that I have to keep an open mind. And I intend to bring my expertise to help in that process. 

Chairman SHELBY. Doctor, given the importance of price stability, do you see any downside to the pursuit of an inflation-targeting regime? 

Mr. MISHKIN. There are many forms of an inflation-targeting, 

and, in fact, there are forms of an inflation-targeting regime that 

could be problematic. I have thought about this issue and discussed 

it in some of my research. 

What is very important is that if you move in a direction along 

these lines, you need to make sure that you do not increase output 

and employment fluctuations. 

Chairman SHELBY. During the past 10 years or so, the monetary 

policy process has certainly become more transparent as an increasing amount of information is now being released than in years 

past. Would you favor any additional specific actions to make the 

Fed more transparent to the public, aside from inflation targeting, 

which we have already discussed? And do you believe there would 

be a point at which transparency would be counterproductive to effective implementation of monetary policy? In other words, it seems 

like maybe we do not need to know everything or every move you 

make, at least when you make it—or before you make it. 

Mr. MISHKIN. Right. I share your concerns about this issue of 

transparency. I think there are potential improvements in transparency that the Federal Reserve System can pursue. This is actually under study at the Federal Reserve currently, and I will actively participate in that discussion, if confirmed. 

I am concerned that you can go too far in transparency. I have 

a paper that says, ‘‘Can central bank transparency go too far?’’ And 

the answer is sometimes yes. So there is a critical balance here. 

The key to transparency is that it actually helps make the Federal 

Reserve more accountable to the political process and to the public, 

but too much information can confuse. So it is an appropriate balance which is what I would seek. 

Chairman SHELBY. I know a lot of people will be talking to you, 

as we do all the Fed members, why are you raising the cost of 

money, interest rates, so to speak. But price stability is very important to this economy, too. It is not just low interest rates. Do you 

want to touch on that just a minute? 

Mr. MISHKIN. Yes, Senator. 

Chairman SHELBY. What do you mean by that? 

15

Mr. MISHKIN. Your point is very well——

Chairman SHELBY. I know what you mean, but——

Mr. MISHKIN. Your point is very well taken. If you do not get 

price stability, that is when you actually get very high interest 

rates. And, unfortunately, we have had periods in the past where 

interest rates in the early 1980’s went up close to 20 percent. We 

do not want to return to that again, and, in fact, price stability, 

which has been the hallmark of Federal Reserve policymaking in 

recent years, has helped produce low interest rates. So a key issue 

here is that low interest rates are a good thing. 

Chairman SHELBY. Keeping inflation under control, right? 

Mr. MISHKIN. Keeping inflation under control is an important 

and critical way of producing that. 

Chairman SHELBY. Ms. Conlin and Mr. Grandmaison, like Senator Sarbanes. I will ask you both this: The Export-Import Bank’s 

impact procedures have been criticized for taking too long to complete and injecting an uncertainty about what transactions the 

Bank can support. What can be done to streamline the Bank’s economic impact procedures while at the same time making sure they 

protect U.S. businesses? Senator Sarbanes and Senator Dodd were 

talking about this. We are interested in jobs, creating jobs for our 

people, and you can play a role there. 

Also, do you think that the Bank’s economic impact procedures 

could be made more transparent so that it is easier for effective 

U.S. companies to have a better opportunity to comment on transactions? 

We will start with you, Ms. Conlin. 

Ms. CONLIN. Yes, Mr. Chairman, if confirmed, I certainly would 

welcome the opportunity to work with the Members of the Committee to increase transparency and predictability where economic 

impact procedures are concerned. As Ranking Member Sarbanes 

pointed out, our mission is to help create and sustain jobs in the 

United States. And we should not be providing financing or extending credit if this indeed adversely affects the U.S. economy, employment, or production. 

Having said that, the transactions that have come before the 

Board and that have involved economic impact considerations have 

been among the most challenging and difficult because typically 

they pit one set of U.S. workers against another set of U.S. workers. 

So, I firmly believe that we should continue our current practice 

of vetting these transactions, of making sure that all interested 

parties have a voice and are included; and at the same time, we 

should make sure that we consider exporters and make sure that 

the process is timely, is predictable, that our exporters in the process have some certainty so that their commercial relationships are 

not jeopardized, and so that we can make sure that our exporters 

and not their foreign competitors are getting those sales and supporting those jobs. 

Chairman SHELBY. Do you have anything to add, sir? 

Mr. GRANDMAISON. The only thing I would add, Senator, is that 

the criticism is justified, and hopefully during the past several 

months, given that several Senators have raised the issue that it 

can be handled internally at the Bank, I do agree with you that 

16

transparency is a key to it, but also responsiveness. The fact is that 

we have to be more open to both sides of any particular issue and 

to be able to explain clearly why the Board or management of the 

Bank may indeed feel one way or the other. 

Chairman SHELBY. Thank you. 

Mr. Moy, I have a question for you, sir. 

Mr. MOY. Yes, sir. 

Chairman SHELBY. You mentioned that base metal prices have 

been rising in recent years, and this has begun to cause industry 

concern. As Director of the Mint, you will be the largest maker of 

coinage, I guess, in the world. Is that correct? 

Mr. MOY. That is correct. 

Chairman SHELBY. What impact will the rising prices of metal 

have on production and unit costs? And how will the Mint work to 

keep the cost of coinage in America efficient and cost-effective? I 

know Senator Allard has a Mint in Denver that he is very interested in, too. We all are because of the—go ahead, sir. 

Mr. MOY. Senator, that is exactly right, and the primary driver 

behind the increased costs of both the penny and the nickel has 

been the metal composition. So it is the rising cost of metals that 

is the primary contributor to these rising costs. 

What I have discovered in what little time I have had to study 

the Mint, they have done an outstanding job keeping all the other 

production costs down. That has actually had a flat trend over 

time. This is an area that, as I mentioned in my opening statement, I am going to spend a considerable amount of time studying 

and bringing options before the Congress, because I recognize Congress’ responsibility to determine not only the denominations we 

make, but also the metal composition of those coins. 

Chairman SHELBY. Senator Sarbanes. 

Senator SARBANES. Thank you very much, Mr. Chairman. 

Mr. Bacino, why don’t we start with you? The Chairman got as 

far as you, and then his time ran out. In recent years, the Finance 

Board has made several significant decisions that I think have 

widespread implications for the Federal Home Loan Bank System 

without any prior notice or the opportunity for public comment. 

For example, the Mortgage Partnership Finance Program and 

the Shared Funding Program, operated by the Chicago Bank, both 

of which were major departures from the banks’ traditional business of making advances, were initially simply authorized by the 

Board and only subsequently addressed through a formal rulemaking process. 

Furthermore, recently the Board allowed the Chicago Bank to 

issue subordinated debt, to include that debt in calculating the 

bank’s minimum capital ratio. Let me repeat that. It issued subordinated debt and then allowed them to include that subordinated 

debt in calculating the bank’s minimum capital ratio. That is unprecedented in the Federal Home Loan Bank System. This decision 

was also made with no notice or opportunity for public comment. 

So, I would just put this very basic question to you: How important is it for a regulator to seek public input, proceed in a transparent manner, when making substantive decisions of this sort 

that have broad implications and that represent a very sharp departure from past practice? 

17

Mr. BACINO. Senator, I would agree that I think it is very important that anytime a regulatory agency chooses to go on any path, 

regardless of whether it is an extreme diversion from what they 

have done before or whether it is a standard regulation, I think you 

need input from the stakeholders. I think you need input from the 

members of the Bank System. And one of the things that I would 

work for there would be some of the stuff similar to what we did 

at the National Credit Union Administration, is to make sure that 

things went out for public comment, to make sure that there was 

adequate notice and that things were not done in the dead of night. 

I think anytime you do something like that, it raises questions, 

regardless of whether or not the program itself would work or not. 

I think you need to be able to listen to the people that have a stake 

in the agency. 

Senator SARBANES. I think that is absolutely right. I mean, the 

substance of the decision is complex, and people may differ on it. 

I happen to think that these are very risky undertakings. But at 

a minimum, the process should be a transparent one, and there is 

a whole procedure for prior notice and for public comment and so 

forth that was not followed in these instances. 

Let me ask you one other question. For the past 2 years, the Finance Board has failed to appoint any Directors to the Boards of 

the Federal Home Loan Banks, the so-called ‘‘public directors’’ despite the requirement in Section 7 of the Federal Home Loan Bank 

Act that the board make such appointments. If appointments are 

not made by the end of this year, the Banks will be missing more 

than 40 percent of their directors. 

It seems to me this is a very serious issue that the Finance 

Board should be addressing. Do you agree with that? 

Mr. BACINO. Yes, sir. I think this is probably going to be one of 

the top three or four issues, if I am fortunate enough to be confirmed, to be sitting on my desk. And I think we do need to make 

sure that we live up to our statutory requirements. And if we are 

required to make those nominations, I feel that is something that 

we should definitely be looking at. But if I am fortunate enough to 

be there, it would obviously be one of the things I would look at 

right away. 

Senator SARBANES. All right. Thank you. 

Mr. Moy, you have a sales and marketing background. We tried 

a $1 coin before just a few years ago. It did not seem to work very 

well. In fact, the only place you see it in is in the homes of consumers who have kept them around. Now we are going to try it 

again. 

Do you have any ideas about what went wrong before and what 

steps might be taken now to make it a more popular coinage? 

Mr. MOY. When I first considered this position of the Mint, I 

tried to go out to my local banking institution to get a $1 coin and 

found out how difficult it is for the Director nominee to even access 

a $1 coin. 

Given my background, and knowing what the Mint does, first of 

all, I am confident that the Mint will be able to produce a beautiful 

coin. It will be done on time. It will be done as efficiently as possible. And so the key here will be making Americans more aware 

18

of the benefits of using that dollar coin, as well as to make that 

coin more accessible. 

Senator SARBANES. I have a question for the two nominees to the 

Ex-Im Bank. I understand the appropriators have tentatively cut 

$6 million from the administrative budget of the Export-Import 

Bank. This does not sound like a lot of money, particularly in the 

terms in which we deal here with the Department of Defense, the 

Department of Homeland Security, and so forth. But for these 

smaller agencies, money of this amount can really have an impact. 

I am told that it will lead to a cut of 10 to 15 percent in the employees at the Export-Import Bank. Is that correct? And can the 

Bank take that kind of cut and continue its activities? There is 

some concern that not enough has been done on small business, 

that the time framework is not tight enough, businesses want 

quicker answers and so forth and so on. 

Ms. Conlin, do you want to take that on first? You are still there. 

Ms. CONLIN. Senator Sarbanes, frankly I share your concern. I 

am deeply troubled and I am concerned about the ramifications to 

the operations of the Bank that this proposed reduction in our administrative budget would mean. And you have hit the nail right 

on the head. 

What this would really jeopardize is our small business effort, 

our small business program that Acting Chairman Lambright has 

dedicated so much time and effort to. We are starting to see solid 

results from this program. This reduction not only will it affect our 

ability to reach these small business exporters—and as a former 

small business person, you know that is near and dear to my 

heart—but it also will affect our ability to service these applications and requests. 

So, I share your concern, and I would hope that there would be 

consideration given to the importance of the outreach programs 

and small business programs at the Bank. 

Senator SARBANES. Well, maybe you and Mr. Lambright could 

visit with the appropriators, if you have not yet done so. 

Thank you, Mr. Chairman. 

Chairman SHELBY. I think Senator Sarbanes is directing some of 

that in a friendly way to the two of us. Senator Allard and I both 

are appropriators. 

[Laughter.] 

Chairman SHELBY. He is a smart man. 

Senator Allard, any questions? 

Senator ALLARD. Thank you, Mr. Chairman. 

I want to start my first question with Mr. Moy, and I think you 

are aware of the problems that we are having with some of the female employees at the Mint, and, in fact, they have filed a class 

complaint. And the basis for this complaint seems to be that there 

is a hostile environment based on gender, and there is engagement 

in a pattern and practice of gender discrimination and then retaliation against any woman who reports harassment claims. 

Specifically, one case went to the U.S. District Court in Colorado 

with a former female employee alleging a hostile work environment. She claims that this began with an assault and culminated 

in her dismissal based on gender, race, and reprisal. 

19

I would like to know what your response would be to this particular—I do not know that you can comment on the specific case 

if it is before a court, but what do you intend to do about the situation in Denver; and then, finally, measures that you think could be 

taken to prevent sexual harassment, which that seems to be a 

problem. 

Mr. MOY. Yes, Senator. First, I share your concerns with what 

has been going on at the Denver facility. As you mentioned, this 

is an ongoing case. It would be inappropriate for me to comment 

on the specifics of this case. But I do have some pretty strong opinions on the subject. 

Quite frankly, any type of sexual harassment is a repellent behavior to me. Growing up Asian American, I have been subject 

from time to time to racial discrimination, so I have a certain sensitivity to discrimination issues. And if confirmed as Director of the 

U.S. Mint, you have my commitment to do everything in my ability 

to make sure that discrimination does not happen at that facility, 

or any of our facilities. 

I do know that since that case, the Mint has started a program 

to put all the employees through a mandatory education on discrimination issues. I am fully supportive of that. I am also fully 

supportive of the zero tolerance policy. But, in addition, I would 

like you to know, sir, that if there are any accusations of discrimination, I am committed to fully investigating them, and depending 

on the results of that investigation, making sure appropriate action 

is taken. 

And, finally, in addition to those existing programs, I like to lead 

by example, and I take pride in the various management jobs that 

I have had in the past having no EEOC complaints, having no accusations of discrimination. And I hope to instill that esprit de 

corps among all the managers and employees. 

Senator ALLARD. I appreciate your response, and if I may be so 

bold as to make one suggestion, it is that you make sexual harassment awareness training regular, because you have some turnover 

on your employees. And I think it is a judgment call as to how 

often, depending on the degree of turnover that you have with your 

employees. But so many times in talking to people who have gone 

through an educational process where they become aware of what 

the law says and what is considered sexual harassment, they are 

not aware that some of the actions that may have been acceptable 

in past years are not acceptable in today’s environs. 

Mr. MOY. Sure. 

Senator ALLARD. And so I think a regular schedule based on 

what your employee turnover might be I think would be helpful, 

or at least look to your new employees coming in, particularly if 

they start moving up where people that are in charge of somebody 

underneath them, I think that becomes important. 

Mr. MOY. Senator, that is a great suggestion, and often reminders are extremely helpful in institutionalizing that behavior. 

Senator ALLARD. The laws have changed in that regard, and I 

think a lot of employers are having to deal with that particular 

issue and rethink their policy. 

I would like to now go to the Export-Import Bank, Ms. Conlin 

and Mr. Grandmaison. How do you view the relationship between 

20

the Bank and the Inspector General? And how can the Inspector 

General help the Bank improve its performance? I would like to 

just hear your comments in that regard. You obviously were paying 

attention when I made my opening comments, and I would like to 

have you respond to those. 

Ms. CONLIN. Senator, if confirmed as First Vice President, I welcome the opportunity to work with the Inspector General nominee 

of the President, if confirmed by the Senate. As you know, I now 

serve as Chair of the Audit Committee at the Bank, so I am well 

aware of the importance of making sure that we have a very strong 

program within the Bank to address and mitigate risk, address 

issues of compliance, as well as issues of fraud, waste, and abuse, 

which would be the responsibilities of the new Inspector General. 

So from my perspective, I would be very supportive and would certainly welcome the nomination and confirmation of an Inspector 

General. 

Senator ALLARD. Mr. Grandmaison. 

Mr. GRANDMAISON. Senator, I remember when I called upon you, 

I guess 4 years ago, you first mentioned your specific concerns regarding an Inspector General, and you sensed my perhaps reluctance in terms of agreeing with you, but you extracted a promise 

from me. I promised you that if I were to be confirmed that I would 

do everything possible to cooperate with an Inspector General, and 

obviously I will meet that promise. 

My colleague mentioned the Audit Committee. The three nonmanaging members of the Board comprise the Audit Committee, 

and I must say that in the past 3 years, major changes have taken 

place with the support of management in terms of the independence of the Audit Committee. What will have to take place is a 

hand-in-glove relationship between the Audit Committee and the 

Inspector General to make sure that our combined efforts complement the agency’s goals. 

If I could just add one point on small business, my concern relative to the suggested cut in the appropriation is that the Congress 

this year has wisely extracted promises from the Bank relative to 

further prioritizing small business. And I believe Senator Sarbanes 

is correct that that is specifically the area that will be hit the hardest if indeed that $6 million cut becomes active. 

Senator ALLARD. I think you understand that the Inspector General becomes the eyes and ears of those of us in the Congress. So 

many of us view that as an important position to have in some of 

our key agencies. 

I have a question just for all of you. I am a strong advocate of 

identifying goals and objectives in a measurable fashion and then 

measuring outcomes, and I would like to have a response from all 

of you. During your tenure in these appointed positions, what key 

performance goals do you want to accomplish? And how will the 

Congress know whether you have accomplished them? It is sometimes referred to as the PART program on the administrative side. 

Over here it was the Government Results and Procedures Act, if 

I remember that correctly. So, I wonder if you would respond in 

that regard, all of you. We can start with Mr. Mishkin. 

Mr. MISHKIN. Well, consistent with the dual mandate, there are 

two measurable issues that you can look at; one is, how are we 

21

doing on inflation; the other is, how are we doing on employment 

and economic growth. So those are fairly easy things to measure 

and things that I am sure everybody looks at. 

Senator ALLARD. Ms. Conlin. 

Ms. CONLIN. Senator, very simply, I would look to see that we 

can increase financing for U.S. exporters that would result in increasing jobs in the United States. But very specifically, I want to 

work with Acting Chairman Lambright to see that we can increase 

the financing for small and medium-sized businesses. As you know, 

we have a mandate from Congress to achieve 20 percent of our financing for small businesses. I do not see that as a floor and I do 

not see that as a ceiling. 

I will echo Acting Chairman Lambright’s words when he said we 

want to go beyond that 20 percent, if at all possible. So that is a 

very important performance measure. It is one that we are all dedicated to, and I would look forward to supporting it. 

Senator ALLARD. I would hope that you would go beyond that. I 

would hope that you would look at the small businesses once they 

got the money and see what happened to the money and, if they 

did, what the results were of getting that money. That is a key 

part, I think, of that measurement. 

Ms. CONLIN. I will add, if I may, Senator, that nothing has given 

me greater satisfaction than to talk to the businesses that have received Ex-Im financing. I recently talked with one of our environmental companies, and they said to me, ‘‘Director Conlin, without 

Ex-Im financing we would not have made this sale. Without Ex-Im 

financing we would not have been able to add the 10 to 15 jobs.’’

So, I know how important in real-life terms our financing is. 

Senator ALLARD. Mr. Grandmaison. 

Mr. GRANDMAISON. Senator, more broadly, I believe there are 

some issues of governance relative to the role of the Board that 

hopefully could be addressed in this next term. One as an example 

would be that, whereas the Bank has some truly exceptional professional career staff people, it should be the Board that decides 

what the reasonable assurance of repayment standard is when it 

comes to providing financing for transactions. 

Senator ALLARD. That is a measurement we need to have. 

Mr. GRANDMAISON. And without addressing that narrow issue, it 

is my belief there is a lot of business that we could and should be 

doing. The interpretation of reasonable is not absolute reassurance 

of repayment. The fact is we are supposed to take reasonable risk. 

And I would like to see us address that as a Board, and then provide that direction to the members of the professional staff. 

Senator ALLARD. Mr. Moy. 

Mr. MOY. I am fortunate that, if confirmed, the Mint is a manufacturing operation that has outstanding performance measures 

and metrics, and they have been operating wonderfully over the 

past 6 years. 

What I hope to do is bring some of my private equity experience 

where you are used to putting companies on a plan, getting them 

a certain amount of revenue, et cetera, sales and those types of 

things, applying that expertise on some of the other areas of the 

Mint that would benefit by having some more solid performance 

standards. 

22

Senator ALLARD. Mr. Bacino. 

Mr. BACINO. Senator, I was lucky in that, after leaving NCUA, 

I did a lot of strategic planning for institutions, which I think gives 

you an idea on making sure that you set the goals and find out if 

the institution meets them. 

I think the goals I would set for the Bank Board while I was 

there would be to make sure that the institutions are carrying out 

their lending and housing responsibilities in a safe and sound manner. 

In terms of the question Senator Sarbanes asked earlier, I want 

to make sure that we would increase transparency. And then I 

think you also have to take into account the stakeholders’ opinions 

and positions, but also understanding that, using my umpire’s 

analogy, at some point someone has to make a call. 

Senator ALLARD. Thank you, Mr. Chairman. 

Chairman SHELBY. Senator Sarbanes, I understand you have 

several questions. 

Senator SARBANES. Thank you. I have to depart, Mr. Chairman. 

I appreciate your allowing me to go out of turn. I got all the way 

across the table except to Mr. Mishkin. I want to put a couple of 

questions to him. 

In 1977, Congress clarified monetary policy objectives for the 

Federal Reserve, and the statutes says, ‘‘The Board of Governors 

of the Federal Reserve System and the Federal Open Market Committee shall maintain long-run growth of the monetary and credit 

aggregates commensurate with the economy’s long-run potential to 

increase production so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest 

rates.’’

My first question is: How fast do you believe the long-run potential growth rate is now for the economy? 

Mr. MISHKIN. Senator, unfortunately, this is a very tough question to answer. Economists actually—

Senator SARBANES. That is why I asked it of you. 

Mr. MISHKIN. I know. 

[Laughter.] 

Economists actually have a very hard time knowing what that 

number is. Not only is it an issue very hard to measure in real 

time with the data, but also we do not even know theoretically or 

from a modeling perspective what the right number is. Indeed, one 

of the problems that has sometimes faced the Federal Reserve in 

the past is that they picked a number and it was the wrong number. In fact, it can go both ways; you could pick a number which 

is too low as a growth rate, and then you actually may have the 

tendency to restrain growth when you should not, but also you 

might have a situation where you go the other direction and then 

lead to a lot of inflation. 

So, I cannot take a stand on this. I think it is actually a very 

tough question. I wish I could give you a better answer, but—

Senator SARBANES. Well, let me take it a step further. Economists at Goldman Sachs—and we have the secretary now from 

Goldman Sachs—have forecast that real GDP growth will average 

2.7 percent between the second quarter of this year and the end of 

2007. They believe that the slowdown in housing activity and the 

23

cash-out refinancing—ending cash-out refinancing with larger 

mortgages will be a sizable drag on the economy. 

Does that forecast sound right to you? 

Mr. MISHKIN. Unfortunately, at this stage I am not a forecaster. 

I work on many different issues. Without the base of a staff that 

really knows what it is doing in terms of forecasting, which I will 

have when I get to the Federal Reserve, if I am confirmed, I cannot 

really tell whether that is a good forecast. 

Senator SARBANES. All right. You defer on that one, too. 

Let me ask you, then, this question: Given this observation from 

Goldman Sachs and the fact that we learned last Friday that jobs 

have grown by only 108,000 a month for the last 3 months, do you 

think that the Federal Reserve should be paying more attention to 

the risk of the economy growing slower than its long-run potential? 

Mr. MISHKIN. Senator, that the Federal Reserve always has to 

worry about the economy potentially growing less than its long-run 

potential, as it also has to worry that the economy is overheating. 

So I think this is always part of what the Federal Reserve has to 

worry about, and is something that I would worry about as well. 

Senator SARBANES. If you were going to move down the path of 

having specific quantifiable targets for inflation, would you also 

have specific quantifiable targets for maximum employment? And 

if not, why not? 

Mr. MISHKIN. Senator, I actually would not be in favor of having 

a quantitative target for maximum employment or for maximum 

economic growth, for the reasons I mentioned earlier. I just do not 

think that we have enough knowledge to do that well enough so 

that——

Senator SARBANES. If you take that position but move ahead on 

specific quantifiable targets for inflation, do not you run the very 

real risk that you will inevitably put more weight on the inflation 

mandate rather than the employment mandate? That will become 

the focus of attention. Those numbers will be what attracts attention. That is what the entire focus will be on. 

Mr. MISHKIN. I share your——

Senator SARBANES. Or close to the entire focus. 

Mr. MISHKIN. I share your concern that you do not want to focus 

on inflation because you have some quantitative measure of what 

you would like to do in the long-run and then forget about employment and output fluctuations. 

Indeed, there certainly are cases where you have an economy 

that is much too slack and should do something about it. You 

should never forget about that, and so the sole focus on inflation 

would be a problem. But a well-designed system—I do not actually 

think the word ‘‘target’’ is a good word for what we should be doing 

in terms of the Federal Reserve—with more explicit goals should 

always worry about the fact that output fluctuations and employment fluctuations are important. 

Senator SARBANES. Well, with the current uncertainty that 

seems to be prevailing and with the volatility that seems to follow 

the statements of leading figures at the Federal Reserve, it might 

just be better to leave these issues to the side, it seems to me. I 

just throw that out as hopefully a helpful piece of advice. 

Mr. MISHKIN. I understand your point. 

24

Senator SARBANES. What is your view about Basel II? I know the 

Chairman may follow up on that, but——

Mr. MISHKIN. Well, I think that the key issue—which is something that I have found in my research—is how important it is to 

have sufficient capital in the banking system in promoting economic health, not just for the banking system but for the economy 

as a whole. The fact that the banking system has been so well capitalized was actually a tremendous help during the recession that 

we just had recently, which was milder than it would have otherwise been. 

A key issue in terms of Basel II, of course, is that you want 

to——

Senator SARBANES. Did you follow that QIS–IV study? 

Mr. MISHKIN. I have not actually spent much time on it, but I 

am certainly aware of the QIS–IV study. One of the concerns that 

that study has raised is that under the Basel II measures, as currently put in place, it would, in fact, mean a large reduction in required capital. That would be something that would concern me, 

that we——

Senator SARBANES. What concerns me is how did we get so far 

down the path in negotiating a framework internationally with respect to Basel II that when it was tested out with this study, it produced results, and everyone says, ‘‘Oh, my God, those aren’t the results’’—you have just said it yourself at the table. Those are not 

the results we want. 

Chairman SHELBY. Yet you are still going down that road. 

Senator SARBANES. Yes. So you have questioned the substance of 

it, but I am raising—I mean, you were not there—but I am raising 

an earlier question, and that is, how did we ever get that far down 

the path? Because now I understand that the Europeans and the 

Japanese are saying to us, ‘‘Well, you cannot pull out now. You 

brought us down this path, and we want to go through with it’’—

even though the study shows substantial problems. 

Mr. MISHKIN. I have not been involved with the Basel II process 

and it is an extremely complicated. 

What I can assure you of is that I am very interested in the 

Basel II process and have always been very interested in issues of 

bank regulation and whether there is enough capital in the banking system. If I am confirmed, it is certainly something that I will 

want to study at the Federal Reserve. I want to make sure that the 

key idea in that, in fact, we do not want banks to be taking excessive risk and want to make sure that there is enough capital in the 

banking system so they have a cushion against bad shocks. 

Senator SARBANES. I will close with this observation. Thank you, 

Mr. Chairman. I think there is a tendency at the Federal Reserve 

Board. They all see monetary policy as a major charge, and they 

are all involved in the monetary policy decisions. Of course, they 

are all on the Open Market Committee, supplemented by a certain 

number of the Federal Reserve regional banks. 

The other areas of responsibility that the Fed has, which are 

quite extensive—I mean, very significant regulatory responsibilities 

in the banking area, and this Basel II is an example of that. They 

have important consumer protection responsibilities. My perception 

is there is a tendency at the Bank to assign that to one or maybe 

25

two of the Governors, and instead of all of the Governors being involved in the decision—I understand why you do that given the 

workload and everything, but it seems to me this Basel II issue has 

risen to the level that it requires the close attention of all of the 

members of the Federal Reserve Board. 

Thank you very much. 

Chairman SHELBY. I just want to pick up on what Senator Sarbanes said. We will hold a hearing again on Basel II. There is deep 

concern on the House Financial Services Committee, too, regarding 

this. And one of my concerns—and I have been on this Committee 

a long time. Not as long as Senator Sarbanes, but we have been 

through the bailout of the thrifts, and if you lower the capital so 

thin you have a downturn or something, you are not only a member 

of the Fed, but you also are a bank regulator there, too. We do not 

want that to happen. We have a pretty good banking system in this 

country. We have not had a lot of bank failures, thank God, lately. 

But you never know what the future is going to be. But capital is 

important, I believe. Isn’t it, Doctor? 

Mr. MISHKIN. I definitely think that capital is extremely important. 

Chairman SHELBY. I hope you will—and you will go on the Fed—

I believe, I am confident of that—soon. But I hope you will look at 

that very closely because it is very important. 

Mr. MISHKIN. I definitely will, Senator. 

Chairman SHELBY. Mr. Moy, I have a question. Going back to the 

coin and the dollar coin, and, you know, people pushed for that and 

said, My God, this is a panacea that the American people want a 

dollar coin and everything. You know, we are familiar with the 

British pound, which is worth a little more, and it is heavy. But 

we are used to it, and when we travel there, the British are used 

to it. They like it, the euro coin. 

What is it? Are the American people adverse to the dollar coin? 

What is the aversion there? What is it? Because that is something 

you will have to deal with. 

Mr. MOY. Yes, and I am beginning to look into that and finding 

out that there is probably a wide variety of reasons why the coin 

was not adopted. But sentiments change over time. 

Chairman SHELBY. Sure. 

Mr. MOY. And I am very interested in finding out what current 

attitudes are, and one of the things that was part of the Presidential Coin Act of 2005 was to set up some of these dollar coin 

forums. The Mint has just had its first one, and I think that has 

gotten some pretty helpful information. And if confirmed, I will be 

attending these as they progress. With that additional information, 

I think we will have a better bead on what is going to make this 

coin more successful. 

But I am very confident that there needs to be more awareness 

by Americans on the benefits of using the dollar coin, which I think 

is a very appropriate role for the Mint to take. 

Chairman SHELBY. Do people use the half-dollar like they used 

to? I see quarters everywhere. I do not see many half-dollars. 

Mr. MOY. If I see a half-dollar, I collect it. 

[Laughter.] 

Chairman SHELBY. Do you know? 

26

Mr. MOY. Yes, I do not know how widespread the use of the 50-

cent piece is. 

Chairman SHELBY. You do not see it every day. You change 

something, it is quarters, very seldom a half-dollar. I just wondered. 

Mr. MOY. Very seldom. And I know that in the rare instances I 

have come across a Sacagawea dollar, instead of using it I keep it. 

Chairman SHELBY. Sure. 

Mr. MOY. Yes, because it is kind of a collector’s item. But I think 

with proper awareness and education, some of those sentiments 

can change. 

Chairman SHELBY. Have any studies been done that you know 

of as to people’s concern with the weight of the dollar? 

Mr. MOY. Yes. 

Chairman SHELBY. In other words, for women, if your pockets 

are weighted down if you have too many of them, as opposed to 

something—go back again to the pound. It is not a light coin. 

Mr. MOY. No, not a light one, and the pound has been very useful. It always works when you stick it in the Underground machines to get your tickets. And so, yes, there are a lot of benefits. 

I am pretty bullish on coins, especially the dollar. And I am anxious to get to work, if confirmed, to make some impact there. 

Chairman SHELBY. Sure. Well, we thank all of you for your appearance here today. We will try to move all of your nominations 

as expeditiously as possible, and we appreciate your willingness to 

serve. We know the President has a lot of confidence in all of you. 

Thank you. The hearing is adjourned. 

[Whereupon, at 12:02 p.m., the hearing was adjourned.] 

[Prepared statements, biographical skecthes of nominees, and response to written questions supplied for the record follow:] 

27


jul12-1.eps
28


jul12-2.eps
29


jul12-3.eps
30


jul12-4.eps
31


jul12-5.eps
32


jul12-6.eps
33


jul12-7.eps
34


jul12-8.eps
35


jul12-9.eps
36


jul12-10.eps
37


jul12-11.eps
38


jul12-12.eps
39


jul12-13.eps
40


jul12-14.eps
41


jul12-15.eps
42


jul12-16.eps
43


jul12-17.eps
44


jul12-18.eps
45


jul12-19.eps
46


jul12-20.eps
47


jul12-21.eps
48


jul12-22.eps
49


jul12-23.eps
50


jul12-24.eps
51

PREPARED STATEMENT OF LINDA MYSLIWY CONLIN

FIRST VICE PRESIDENT-DESIGNATE

EXPORT-IMPORT BANK OF THE UNITED STATES

JULY 12, 2006

Mr. Chairman, Senator Sarbanes, and distinguished Members of the Committee, 

I am pleased to come before you today as the President’s nominee to become First 

Vice President of the Export-Import Bank of the United States. I appreciate the confidence the President has placed in me and I am grateful for another opportunity 

to contribute to an institution where I have had the privilege to serve these past 

2 years. 

If confirmed, I look forward to continuing to work with the members and staff of 

this Committee to help sustain and increase the number of high-paying U.S. jobs 

by financing export transactions that otherwise would not go forward. 

I would like to recognize my husband, Joe, and my dear friend, Louise Wheeler, 

who are with me here today, and the fine team from the Ex-Im Bank. I would like 

to acknowledge as well the colleagues from our sister U.S. Government agencies and 

the industry association representatives here today. Their cooperation and support 

have meant so much during my tenure as a Member of the Board at Ex-Im Bank. 

On February 26, 2004, I came before the Committee as the President’s nominee 

to be a Director at the Export-Import Bank. Since then, I have endeavored to honor 

the confidence that you placed in me and the commitment I made to you: Simply 

stated, to ensure that U.S. exporters have the financing tools they need to succeed 

in today’s highly competitive global economy. 

As a Board Member, I have been given the responsibility of overseeing a key Congressional mandate: Increasing the Bank’s financing of environmentally beneficial 

goods and services, including renewable energy. We continue to make a difference 

in this area. Ex-Im Bank has supported more than $1.1 billion of U.S. exports of 

environmentally beneficial goods and services over the past 4 years. In this regard, 

it has been personally gratifying for me to work with the Bank’s Environmental Exports Team, a group of enthusiastic and dedicated professionals from various departments who have helped implement this program. 

As a result, Ex-Im financing is supporting high-quality jobs in the United States, 

while enabling international buyers to access U.S. technology to address important 

global environmental needs. 

As a former small business owner, I am also pleased to be working with the many 

small and medium-sized companies that make up the lion’s share of the U.S. environmental sector. These entrepreneurs serve as the backbone of the American economy and their risk-taking fuels our free market system. I want to do everything I 

can to help them grow. A key to that growth is Ex-Im financing that can help shoulder the risk of opening up new markets overseas. 

I have personally witnessed the positive results of the Bank’s expanded small 

business program over the past year. Assuming the Bank is provided sufficient administrative resources going forward, I firmly believe that the Bank’s efforts focused 

on small businesses will continue to grow. I, therefore, welcome the opportunity to 

assist Acting Chairman Jim Lambright in helping these companies succeed in the 

global marketplace. 

It has also been my pleasure to work with Ex-Im’s Sub-Saharan Africa Advisory 

Committee and business development team to increase financing in that region, 

building upon the hard work and success of my former colleague and Ex-Im Bank 

Board Member-Designate, Joe Grandmaison. I am pleased to say that Ex-Im Bank 

is implementing many of the Advisory Committee’s recommendations, including 

strategies to expand cooperation with leading African banks and to build business 

in the important Gulf of Guinea region. 

If confirmed as First Vice President, I will use my experience both at Ex-Im Bank 

and in trade development at the U.S. Department of Commerce to leverage the resources of Federal agencies and industry organizations to accomplish our shared 

goals. 

I welcome the opportunity to work with Ex-Im Bank’s Chairman and executive 

leadership to ensure that Ex-Im Bank’s programs and policies remain competitive. 

I would look forward to engaging the energy and good ideas of the Bank’s bipartisan 

Board, the talent and innovation of the dedicated professional staff, as well as the 

experience and customer knowledge from Ex-Im Bank’s many important stakeholders in the exporting community. 

Mr. Chairman, Senator Sarbanes, and Members of the Committee, I respectfully 

ask for your favorable consideration of my nomination and will be pleased to respond to your questions.

52


jul12-25.eps
53


jul12-26.eps
54


jul12-27.eps
55


jul12-28.eps
56


jul12-29.eps
57


jul12-30.eps
58


jul12-31.eps
59

PREPARED STATEMENT OF EDMUND C. MOY

DIRECTOR-DESIGNATE, U.S. MINT

U.S. DEPARTMENT OF THE TREASURY

JULY 12, 2006

Chairman Shelby, Ranking Member Sarbanes and Members of the Committee on 

Banking, Housing, and Urban Affairs, thank you for this honor and opportunity to 

appear before you today to discuss my nomination to become the 38th Director of 

the U.S. Mint. Joining me today is my wife, Karen. 

To many Americans and me, the U.S. Mint represents the best of America. I respect its place in our history. I appreciate the beauty and artistry of its coins. I 

value its role in facilitating commerce, and I have learned about our collective culture through its designs on the Nation’s coinage. I am pleased and honored by the 

trust President Bush has placed in me by asking me to serve in this important position, joining the ranks of those privileged to serve as Directors since President 

Washington asked David Rittenhouse to serve as the first Director of the Mint in 

1792. If confirmed, I look forward to working closely with this Committee and Congress on all the policy and legislative issues that will determine the course for 

American coinage now and in the future.

The U.S. Mint applies world-class business practices in making, selling, and protecting our Nation’s coinage and assets.

I am committed to this mission statement and the 2,000 men and women of the 

U.S. Mint who work to implement the practices that fulfill the requirements of Congress and the country to produce approximately 15 billion coins annually. These 

coins are distributed to the Federal Reserve banks and branches for commerce and 

trade; The U.S. Mint also maintains the physical custody and security of the Nation’s more than $100 billion in gold and silver assets. And finally, it produces numismatic coins, medals, gold, silver, and platinum bullion coins for the general public to collect. 

I value public service and, if confirmed, I will bring to bear all the experience I 

have earned through my career in management, marketing, and human resources 

both in the private sector and government. These are essential areas for the U.S. 

Mint which also shares characteristics of both a business and governmental organization, operated for the benefit of the public, with revenues approaching $2 billion. 

I have spent 10 years as a sales and marketing executive, 8 years working with 

venture capital firms and entrepreneurs, and 4 years overseeing $7 billion in annual 

Federal Government expenditures for managed health care programs with the Department of Health and Human Services. I am familiar with the demands of being 

an officer and director, having served in those capacities at several companies and 

nonprofits. 

Most recently, I have been honored to serve the President of the United States 

in a human resources capacity as a Member of the Office of Presidential Personnel. 

I have worked closely with many members of the cabinet and independent agencies 

to understand the results they desire, recruiting the Nation’s best and brightest to 

attain those results, and then making recommendations to the President for those 

who may serve as appointees. I understand the responsibility appointees have to the 

President, and their accountability to Congress and the American people to be good 

stewards of the public’s trust and resources. I am confident that my experience and 

qualifications will contribute to the continuing success of the U.S. Mint. 

If confirmed, I see some immediate responsibilities and challenges before me. Implementing the ‘‘Presidential $1 Dollar Coin Act of 2005,’’ which this Committee approved, is a major operational focus for the U.S. Mint that is well under way. As 

directed by that legislation, the U.S. Mint has, and will continue, to work with those 

who can influence and encourage the greater use and acceptance of dollar coins in 

American commerce. 

The rising cost of metals used in coin production is prompting some needed analysis and consideration of the impact of that trend on all denominations of coins, especially the penny and nickel. Public preferences and priorities on this subject will 

loom large, and the U.S. Mint will need to provide technical and manufacturing considerations to Congress, the Administration, and others who are evaluating the future course of coinage. 

Reviewing, refining if necessary, and implementing the U.S. Mint’s business, 

management, operational, and strategic plans, executing the President’s Management Agenda, and providing effective leadership, are priorities for me should I be 

confirmed. 

Thank you for the honor and privilege to appear before you today.

60


jul12-32.eps
61


jul12-33.eps
62


jul12-34.eps
63


jul12-35.eps
64


jul12-36.eps
65


jul12-37.eps
66


jul12-38.eps
67


jul12-39.eps
68


jul12-40.eps
69


jul12-41.eps
70


jul12-42.eps
71


jul12-43.eps
72


jul12-44.eps
73


jul12-45.eps
74


jul12-46.eps
75


jul12-47.eps
76


jul12-48.eps
77


jul12-50.eps
78


jul12-51.eps
79


jul12-52.eps
80


jul12-53.eps
81


jul12-54.eps
82


jul12-55.eps
83


jul12-56.eps
84


jul12-57.eps
85


jul12-58.eps
86


jul12-59.eps
87

RESPONSE TO WRITTEN QUESTIONS OF SENATOR BUNNING

FROM FREDERIC S. MISHKIN 

Q.1. What is the appropriate inflation-targeting method for the 

Federal Reserve?

A.1. The form of inflation targeting that I advocated in the past as 

an academic is flexible rather than rigid or mechanical, forwardlooking and forecast-oriented rather than backward-looking, and 

should be fully sensitive to the dual mandate of the Federal Reserve to promote maximum sustainable employment as well as 

price stability. A hallmark of the approach that I have advocated 

is clear communication of the objectives, strategies, and outlook of 

the Federal Reserve to better inform the public and markets and 

increase the accountability of the Federal Reserve. However, my 

past experience as a policymaker has taught me that moving from 

academia to the policymaking world often necessitates a modification of views to better deal with practical considerations. Thus, I 

expect that there will be some evolution of my thinking once I become a Member of the Board of Governors, if I am confirmed by 

the Senate. I am certain that these issues will be an important 

focus of discussion and debate among the members of the FOMC 

in coming months and years, and I look forward to participating in 

that process, should I be confirmed.

Q.2. Are there differences between your views on inflation-targeting and those of Chairman Bernanke?

A.2. I have not spoken with Chairman Bernanke about his views 

on inflation-targeting since he became the Chairman. As my views, 

and I am sure his, have evolved since we wrote together on this 

topic, I would suspect that we would have our differences. 

However, because I do not know what these differences might be, 

I do not have a clear-cut answer to this question.

Q.3. What factors or indicators do you look at when assessing inflation? Which are most important?

A.3. In recent years, I have not focused intensely on inflation forecasting, but I can give you a few indications based on my observation of central banks around the world. In general, it seems to me 

the best approach is quite eclectic and relies on regular inspection 

of a broad range of indicators. Among these would be the prices of 

labor, commodities and materials, and other inputs into the production process; indicators of the pressures on productive resources 

such as the unemployment rate and the rate of capacity utilization; 

indicators of foreign activity and contributions to domestic inflation 

such as foreign rates of GDP growth, exchanges rates, and price indexes for imports; productivity growth; and a variety of measures 

of inflation expectations including both survey-based measures of 

short- and long-term expectations as well as measures of inflation 

compensation implicit in the relative prices of nominal and inflation-protected Treasury securities. The most important indicator of 

the success of a central bank is the performance of inflation itself; 

for that variable, a central bank must, over the long-term, be held 

accountable.

Q.4. From your experience, do you believe that the statements and 

minutes released to the public accurately reflect the debates that 

88

take place within the Federal Reserve when considering monetary 

policy decisions?

A.4. I am able to give only a qualified answer to this question. I 

have not attended FOMC meetings for nearly a decade (that is, in 

the period since I resigned my position as Research Director at the 

Federal Reserve Bank of New York), and consequently do not have 

direct knowledge of the proceedings of such meetings over that interval. Moreover, I have not reviewed the minutes of the FOMC 

meetings for the period during the mid-1990’s in which I attended 

FOMC meetings. Finally, the Federal Reserve followed significantly 

different practices regarding its post-meeting announcements in 

the period during which I attended the meetings than it does at 

present. That said, my impression based on my experience during 

that interval and more generally is that the statements and minutes accurately reflect the monetary policy discussion at FOMC 

meetings.

Q.5. The Fed has a bad track record of going too far on interest 

rates, most recently in 2000. What are the implications if the Fed 

gets it wrong this time? What will happen if the Fed overshoots or 

undershoots, and do you think either are a possibility in the current cycle of tightening?

A.5. Monetary policy influences the economy and inflation with 

long lags, and consequently monetary policy must be made on the 

basis of forecasts. Such forecasts are always subject to considerable 

error. Consequently, policy ‘‘undershooting’’ or ‘‘overshooting’’ is always a possibility. For that reason, the Federal Reserve needs to 

monitor carefully incoming information that affects the outlook for 

the economy and inflation. When incoming information suggests a 

different outlook than had been anticipated, the Federal Reserve 

needs to adjust the stance of monetary policy accordingly in order 

to achieve a reasonable balance of risks to the attainment of its 

statutory objectives of maximum employment and price stability. If 

confirmed by the Senate, I will do my utmost to help in the Federal 

Reserve’s deliberations and make it less likely that the Fed will 

overshoot or undershoot in its setting of interest rates.