After Lawrence Summers withdrew from contention to be the next Fed Chairman, it became likely that current vice chairman Janet Yellen will get the job (that story is detailed here). Here are the six things you need to know about the likely successor to Ben Bernake.
1. She has the pedigree for the job. With an undergrad degree in economics from Brown, a PhD from Yale, tenure as a professor at Harvard and Berkeley, time as an advisor to Clinton while he was president, a post as President of the Federal Reserve Bank of San Francisco, a current job in the Fed’s #2 position as vice-chair, she is certainly qualified.
2. She has an independent streak. I view this positively as she is likely to be more data driven and make decisions based on the best available information rather than what may be popular.
3. Her forecasting ability is renowned. Yellen has diverged from people who suggested the economy would be just fine. She also foresaw the housing bubble and the subprime mortgage crisis. She is one of a handful of people to do that accurately and without the benefit of hindsight.
4. She cares about unemployment. Her academic expertise is in unemployment. She asserts that the issue isn’t just about statistics to her, and that the toll of unemployment on the mental and physical health of people searching for work is crushing. I’m optimistic that she’ll work to support jobs desirable to recent college grads and the middle class.
5. She is a good manager. She is described as rational, judicious, and prepared. She seems to get along well with others and is a good collaborator. Her strength is being able to see many sides of an argument and form a group consensus. She avoids micromanaging. In short, she sounds like the ideal boss.
6. She is the most qualified. That is hard to dispute. She would also break the glass ceiling in the fed, becoming the fist woman to head it. The next head of the Fed will be responsible for shaping the $17 Trillion U.S. economy and guiding the country at a time when disparity between social classes is the widest it has been since the great depression.
If she is confirmed, this will be a very exciting and positive movement for our country.