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Would this person be the new head of the fed if she was a male?
While the majority around here are still wandering in the dualism of partisanship we have a new fed chair coming in.
http://www.economist.com/news/financ...dove-ascendantFor most of the past few years, monetary policy has urged the economy on while dysfunctional fiscal policy has held it back. Barack Obama’s decision to nominate Janet Yellen to succeed Ben Bernanke as the Fed’s chairman in February raises the odds that stimulative monetary policy will continue. But disquiet about that stance is growing.
In addition to being the first woman to run the Fed, Ms Yellen is also the first acknowledged dove. Presidents once felt compelled to appoint monetary-policy hawks such as Paul Volcker and Alan Greenspan to reassure markets that the Fed would not suc b to the political system’s inflationary bias. In appointing Ms Yellen Mr Obama has implicitly acknowledged how much the world, and the Fed’s priorities, have changed. Since 2008 America, like many other countries, has struggled with slack demand and high unemployment. Meanwhile, energy prices excluded, inflation has persistently fallen short of the Fed’s 2% target.
Ms Yellen is not alone in believing that unemployment is a bigger problem than inflation. So do most of her colleagues on the Federal Open Market Committee, through which the Fed sets interest rates. But she has felt that way longer and more strongly. She pushed publicly last year to hold interest rates near zero for longer than the Fed then planned, to hasten the fall in unemployment, even if that caused inflation to rise briefly above 2%. She was the principal author of the Fed’s current statement of long-term goals and operating principles, which stresses the equal importance of its twin statutory goals of full employment and low inflation.
As vice-chairman, Ms Yellen helped Mr Bernanke nudge the FOMC towards its commitments to keep its benchmark interest rate at zero (where it has been since late 2008) at least until unemployment has dropped to 6.5% and to keep buying $85 billion-worth of bonds a month with newly printed money (“quan ative easing”, or QE) until the labour market has improved substantially. These policies have not fuelled inflation, as hawks feared they might. Indeed, Ms Yellen would probably welcome having to tighten due to inflationary pressure, because that would mean demand was buoyant. But hawks still worry that the Fed is distorting prices in financial markets, breeding excessive risk-taking and preventing investors in Treasury bonds from demanding fiscal discipline.
Such concerns are widespread among Republicans in the Senate (which must confirm her). Several voted against her nomination to be vice-chairman in 2010. “She was not particularly modest about the role of monetary policy in the economy and I don’t see any evidence that that’s changed,” one such Republican, Bob Corker of Tennessee, said this week.
With the support of the Senate’s Democratic majority, Ms Yellen is almost certain to be confirmed. But with many Republicans opposed, she will probably get fewer than the 70 votes Mr Bernanke did for his second term in 2010, at the time the lowest on record for a Fed chairman. Moreover, one of the seven seats on the Fed’s board is vacant and another five may come up for grabs in the coming year, given expirations and the tug of other opportunities. The weight of opinion within the ins ution could change markedly as a result.
Minutes of the Fed’s last meeting, in September, show that it is already divided on QE. Many officials wanted to slow its pace. But the view that the economy was not strong enough prevailed, and the Fed surprised the market by sticking to its current pace of bond-buying. Once in office, Ms Yellen is likely to pursue a gentle “taper” coupled with a firm commitment to keep interest rates at zero. If the economy falters—an all-too-real possibility given America’s budget mess—she may want to increase QE, but might struggle to persuade her colleagues. The Fed’s strength, she said in accepting the nomination, is its capacity to “vigorously debate diverse views, and then to unite.” Maintaining that trait may be her biggest challenge.
Now admittedly the Economist does have a business bias so i encourage people to learn more about who is about to be one of the more powerful people in the world. She is for example married to a Nobel Laureate in economics.
Would this person be the new head of the fed if she was a male?
What's that supposed to mean? Do you not think mrs yellen is qualified for the job?
Job discrimination against men must end!
The real question is can monetary policy really affect US unemployment long term? I watched a really interesting panel of industry and financial leaders discuss this on CNN while I was flying back from LA today. My takeaway was that you better damn well have something to sell that people want or in this modern economy you are out of luck. The excess money will inevitably flow in a global economy to areas that are producing talent/goods people want (one example being Taiwan and flat screen TV's) One guy was from Ireland and he admitted that their economy had to adjust to 20-25% wage deflation over the last few years so they could now compete as an "emerging economy" with the rest of the world.
Ireland though doesn't control it's own currency, so they don't have much options.
Downgrading standard of living only works to a certain extent here in the US (because most of those that are reaping all the benefits from outsourcing, etc are actually here and make up the top percentile).
What you're likely going to see is the wealth gap widening even more. At some point though, if they don't loosen up a bit, there's not going to be a market here.
Loosen up in what way?
Well, there's many ways. Investing in at least some jobs here would be one way.
What is your definition of "invest in jobs"?
This is not Henry Fords America. This is a global economy.
In areas where they would save 2c a piece making in Ashaftagan, they could just make it here. Especially companies that are heavily reliant on the US market.
It's the reason you see companies like Apple shifting some manufacturing back to the US.
It's a global economy, but the big buyers aren't everywhere. And if you keep making the big buyers a rarity, you won't have a market anymore.
tax incentives for roof top and centralized solar, plenty of production tax credits wind power
build new power transmission networks to wind and solar farms
upgrade the national electrical grid
fix all the roads, bridges, sewers, water systems.
SAWS is building desal plants for the brackish water from south TX.
CA, TX should invest in massive desal plants, like the Aussies are for Melbourne AU.
invest in scrubbers for all coal-fired plants.
all steel, solar panels, wind turbines above must be produced in USA .
invest heavily in pre-K, K-12, train the teachers better, and pay them a lot more.
Last edited by boutons_deux; 10-13-2013 at 08:42 PM.
All we economists got is Theories, man!
5th consecutive JEW
Agreed. I like David MacNeil's take.
http://assets.weathertech.com/assets...o_you_1212.pdf
Dude. You got BEER! You supply something people WANT!
No issue, they're uniquely qualified.
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