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Obama to nominate new Fed deputy

By Allison Ross · Bankrate.com
Friday, January 10, 2014
Posted: 4 pm ET

Following Janet Yellen's confirmation by the Senate this week as the next Federal Reserve chair, President Barack Obama on Friday announced plans to nominate Stanley Fischer as Yellen's successor as vice chair of the Fed.

Obama also announced his intention to nominate two people for seats on the central bank's seven-member Board of Governors. Lael Brainard, who recently stepped down as the Treasury Department's undersecretary for international affairs, is being tapped for one of the vacant seats, while Jerome H. Powell, who has served on the Fed board since 2012, will be renominated.

The nominations had been widely expected and come at a time when the Fed is working to pull back on its quantitative easing initiative without damaging the economy.

"These three distinguished individuals have the proven experience, judgment and deep knowledge of the financial system to serve at the Federal Reserve during this important time for our economy," Obama said in a prepared statement.

Fischer, 70, is highly regarded for his knowledge of responses to international financial crises, having served as the governor of the Bank of Israel from 2005 to 2013. He's also worked as vice chairman of Citigroup, and was the first deputy managing director of the International Monetary Fund, working there from 1994 to 2001. He took a high profile during crises in Asia, Russia, Brazil and other countries in his role at the IMF.

From 1973 to 1994, he taught economics at the Massachusetts Institute of Technology, and among his students were Fed Chair Ben Bernanke and former Treasury Secretary Larry Summers.

Although Fischer has an extensive banking and economics background, many are curious to see what he'll do as vice chair of the Fed.

Earlier this week, Sen. Elizabeth Warren, D-Mass., in an interview with Bloomberg TV, said she was "not sure" about Fischer at the Fed.

She noted that this is a difficult time for the Fed.
"I want to be hopeful that Fischer's going to work in the right direction," Warren said.

What do you think of Obama's nominations? And where should the Fed go from here?

Follow me on twitter: @allisonsross.

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