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Yellen approved as next Fed chair

By Mark Hamrick · Bankrate.com
Monday, January 6, 2014
Posted: 5 pm ET
Janet Yellen

Janet Yellen is set to be approved by the Senate as Federal Reserve chair.

The Senate has approved the nomination of Janet Yellen to run the Federal Reserve. As the first woman who will serve as chair of the central bank in its 100-year history, she is set to take control of the Fed as it begins winding down the measures taken during the financial crisis. The vote was 56 to 26 in the Democrat-controlled Senate. Bad weather kept some Senators away from the session.

While the Fed plans on tapering asset purchases this month, most members of its committee believe it won't be until 2015 that short-term interest rates will rise from their current low levels.

In a statement after the evening vote, Senate Banking Committee Chairman Tim Johnson, D-S.D., said, "Americans should feel reassured that we will have her at the helm of the Fed as our nation continues to recover from the Great Recession." She begins a four-year term Feb. 1.

"She comes in ready to take over, and I think that's a good thing," says Amy Crews Cutts, chief economist at Equifax. "The big task is how does the Fed unwind the not only unprecedented but magnificent scale of the intervention they've put into the market," she says.

Also on the Fed "to-do" list is naming a new vice chair to succeed Yellen. Published reports indicate the White House is poised to nominate former International Monetary Fund official Stanley Fischer, highly regarded for his knowledge of responses to international financial crises.

The Fed's next policy-setting meeting is scheduled for the end of January. After that, Yellen's first meeting as chair is set for March 18-19, capped by a news conference. As for a change in management style, Cutts says any differences may be subtle. "She'll put her own flavor on it, but I think she'll be very consistent with what Bernanke has said and done," says Cutts. She says the differences will be akin to the "flavoring of spices, as opposed to a fundamentally different dish."

Do you expect that Janet Yellen will make big changes at the Fed? What do you think of Ben Bernanke's legacy?

Follow me on Twitter: @Hamrickisms.

 

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7 Comments
Elizabeth
January 08, 2014 at 8:05 pm

I am concerned that with all the bright minds in America the vice chair of the Fed will be an Israeli banking person. What is the deal with this? Israel is a separate country with different views about many things that are not I solidarity with the American people--not just the Palestinian issue but about their overall mission and goal in this global economic environment. These types of moves makes many suspicious of their real intentions.

Robert
January 07, 2014 at 1:01 am

Greg...doesn't matter if you're blue, black, white or green. Poor leadership and poor policies always bring America down. If our country's leaders, on both sides of the isle, would enact policies that benefited the American People instead of making choices that helped them selfish little selves get re-elected, we all would be better off and would get ourselves out of this mess...and it's still a mess no matter what the stock market indicates, what the Fed chair says, or what the Prez preaches on CNN.

greg mcdaniel
January 06, 2014 at 11:46 pm

It seems obvious to me that Mr. Bernanke is getting out before the results of his policy of direct cash injection to the economy are felt. Guess the thing to do lately is set up a minority or women to take the fall for bad policy, then you end up with only white guys in charge.

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