Former Federal Reserve Chairman Yellen Will Be Nominated By Treasury Secretary Biden As “Dovish” Who Insisted On Slowly Raising Interest Rates | Biden Finance News

Original Caption: Former Fed Chairman Yellen To Be Nominated By Biden Treasury Secretary! Adding the tag “Dovish”, once arguing against the crowd and insisting on slowly raising interest rates

Every editor Zhang Xiwei

The United States will usher in the first treasurer in history.

According to CNBC news, Biden will nominate former Federal Reserve chair Janet Yellen (Janet Yellen) as Secretary of the Treasury. If ultimately confirmed, Yellen will become the first female Treasury Secretary in American history.

It should be noted that Yellen already made history before becoming the first female president of the Fed in the United States.

The “safe” choice of the US Secretary of the Treasury?

On October 9, 2013, then-President of the United States, Obama, nominated Yellen to succeed Bernanke as chairman of the Federal Reserve. She took office on February 3, 2014 and became the first female president in the history of the Federal Reserve.

Yellen, 74, is also widely viewed as a “safe” choice for the job of US Secretary of the Treasury. You may be able to fight for a mutual compromise between the two sides and bridge policy differences during economic difficulties. Therefore, the US stock market rose slightly after the announcement.

Investors are likely to welcome Yellen. During her tenure as Fed chair, even if she raised interest rates for the first time in 11 years, tech stocks doubled.

If it is ultimately confirmed, Yellen will usher in one of the most demanding positions in the new government and face many unique economic hurdles. While the epidemic still hits the American economy severely, the United States Secretary of the Treasury will receive increased attention from the outside world.

Previously, people familiar with the matter revealed that aides to US President-elect Biden told Fed Governor Lael Brainard that he needs to stay at the Fed. This also means that the possibility that Brainard become the next US Treasury Secretary He has gotten even thinner and the market has already done it There is speculation that Yellen will become US Secretary of the Treasury with a high probability.

Have you ever tried to reject all arguments and insisted on slowly raising interest rates

It should be noted that Yellen is one of the few Fed chairs who has not been reelected. Although he has only been in charge of the Fed for 4 years, he has actually worked for the Fed for 14 years. During the tenure of his predecessor Bernanke (2006 ~ 2014), Yellen was the most active supporter of the QE (quantitative easing) policy.

Yellen is particularly concerned about the job market. Faced with various doubts within the Fed and the misunderstanding of the market, he insisted on raising interest rates slowly because he believed that after a severe financial crisis, recklessly ending the stimulus policy would hamper economic expansion. At the same time, he also emphasized the fall in neutral interest rates, so the Fed has less room to raise interest rates than in previous years. Four years later, events have shown that inflation has not skyrocketed because of this and that the US economy continues to expand as well.

In early 2015, the Fed expected to raise interest rates four times that year. However, due to unexpected economic conditions in various aspects, the interest rate hike plan was pushed over and over again. This is also Yellen’s insistence. The analysis noted that from a “hidden view” perspective, the slow rate hike during Yellen’s tenure may be one of the biggest contributions to the US economy.

When Yellen took office, almost all Fed officials believed that interest rates would eventually return to the pre-crisis average of 4%. But during Yellen’s tenure, the Fed lowered the neutral interest rate to around 2.8%. In the 1990s, the Fed paid little attention to neutral interest rates and believed that they were always around 4%. It wasn’t until Yellen took office that the neutral interest rate attracted attention from all walks of life. Relevant data shows that in 2017, neutral interest rates accounted for 20% of the speeches and statements of the Federal Reserve.

Given that Yellen only served one term, it is difficult to compare her with other Fed presidents. She is also the only president who has not experienced a major recession or crisis, and did not cut interest rates during her term. Nomura Securities’ US Chief Economist Lewis Alexander said: “The challenges in Yellen’s tenure are not as thorny as Bernanke’s, nor as difficult as Volcker’s, but Yellen’s challenges are more subtle and should be more subtle. Careful judgment “.

Added “Dovish” tag

It is reported that he received the Wilbur Cross from Yale University in 1997, an honorary doctorate of law from Brown University in 1998, and an honorary doctorate in humanistic literature from Bard College in 2000. In 1980, Yellen devoted himself to research in the Haas School of Business at the University of California, Berkeley. He is now a professor emeritus at the school and has twice won the school’s award for outstanding teaching.

Yellen is a member of the American Academy of Arts and Sciences. She has served as Vice President of the American Western Economic Association, Vice President of the American Economic Association, and a member of the Board of Directors of Yale University. On macroeconomics, he has numerous research articles, focusing on the causes, mechanisms and effects of unemployment. Author of “Unemployment and the labor market”, “Monetary and fiscal policy”, “Investment policy and international trade”, etc.

After the “financial crisis”, even if the US economy begins to recover, Yellen believes that the high unemployment rate in the US will continue to exist, causing the economic growth rate to remain lower. than the potential growth rate. The economy faces a risk of deflation greater than the risk of inflation. The view that fiscal deficits will inevitably lead to high inflation justifies the coordination of fiscal policy and loose monetary policy. So even if the United States faced inflationary pressures in 2011, Yellen and other dovish Fed figures insisted on “keeping interest rates at record lows for a period of time.”

Within the Fed’s decision-making sphere, the dispute between “hawks” and “doves” has a long history. The central differences between the two factions lie in their attitudes on the two main issues of fighting inflation and guaranteeing employment. The “hawks” are opposed to inflation and the “doves” are more concerned about the weakness of the labor market and weak economic growth. The outside world generally labels Yellen as “dove”, and even the media write her as “Queen of the dove”.

Her husband is a Nobel laureate in economics.

According to public information, Yellen was born in Brooklyn, New York, United States, on August 3, 1946. He was president of the Federal Reserve Board and professor at the UC Berkeley School of Economics and Business.

Yellen graduated from Brown University (BA in Economics) and Yale University (Ph.D. in Economics), and later served as a professor at the Haas School of Business at the University of California, Berkeley, serving as the 18th Chairperson of the President’s Council of Economic Advisers (by Nominated by former US President Bill Clinton). He has twice won the Outstanding Teaching Award from the Haas School of Business at the University of California, Berkeley, and served as Vice Chairman of the Federal Reserve Board (period from October 4, 2010 to October 4, 2013 ).

Yellen is the former chair of the Federal Reserve Board, the first woman to head the Federal Reserve in its century-long history, and the first Fed chair with a Democratic background since Paul Volcker since the 1980s. Her husband is George Akerlov, winner of the 2001 Nobel Prize in Economics and a professor at the University of California, Berkeley.

From February 3, 2014 to February 5, 2018, Yellen served as Chairman of the United States Federal Reserve Board. On September 22, 2016, Bloomberg’s 50 Most Influential People on the World List, Yellen ranked 8th.

On April 20, 2017, the US magazine “Time” officially announced the “Time’s 2017 Global 100 Influencers List”, and Fed Chairman Yellen was selected as the category of economic and social leader of ” Titans “most important on the list.

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