Dr. Janet L. Yellen took office Monday, Feb. 3 as Chairwoman of the Board of Governors of the Federal Reserve System. She also became the first female to take the Fed’s top leadership position in its 100-year history. Yellen will serve a four-year term ending Feb. 3, 2018. She has been serving as vice chairwoman since October 2010, and since that time also has been serving a 14-year term as a member of the board which will extend to Jan. 31, 2024. Yellen further chairs the Federal Open Market Committee, which serves as the Federal Reserve’s main entity for monetary policy-making.
Yellen’s assumption of the Fed’s top spot follows a contentious confirmation debate in the U.S. Senate. Despite threats of filibuster against her appointment, her confirmation ultimately passed the Senate when lawmakers approved her by a 56–26 vote Monday, Jan. 6. Eleven Republicans crossed over party lines to join Democrats in voting for her confirmation.
Republican objections focused largely on loose monetary policy, as noted by The Financial Times.
“The stock market has become addicted to the Fed’s easy money policy,” The Financial Times quoted Sen. Chuck Grassley (R-Iowa), pointing out that Grassley also had voted against previous Fed chairman Ben Bernanke’s second term.
Among the thorny issues surrounding the vote was Republican opposition to the Fed’s $85 billion per month asset purchase program (actually reduced to $75 billion for January).
Bernanke described the work ahead for Yellen as a “measured reduction” in the asset-buying program throughout 2014. Republicans including Senator Chuck Grassley who publicly opposed her nomination voiced concerns that the Fed’s plans – and nominee Yellen’s plans on how to wind down the asset purchasing without “spooking investors” were unclear.
Euronews described the changing of the guard as coming “at a tricky time”. Yellen has been an unwavering advocate of the Fed’s aggressive steps to boost the U.S. economy. But Bernanke’s successor will now be charged with weaning it off so much stimulus, first by winding down the latest bond-buying programme.”
Yellen’s appointment is exceptional in other respects too. She has authored substantial work on macroeconomic issues which particularly include analysis of the causes, mechanisms, and implications of unemployment. Many Fed-watchers regard her approach to the work of the Fed as more balanced with regard to Main Street as well as Wall Street concerns. She also brings to the office of Chairman a distinguished record of experience as a Fed insider.
Yellen graduated summa cum laude with a degree in economics from Brown University in 1967. She received her doctorate in economics from Yale University in 1971. She then served as an assistant professor at Harvard University from 1971 to 1976. She served as an economist with the Fed’s Board of Governors in 1977 and 1978, and as faculty with the London School of Economics and Political Science from 1978 to 1980. She is also professor emeritus at the University of California at Berkeley, where she has been a faculty member since 1980.
In August 1994, Yellen took leave from Berkeley to serve as a member of the Board of Governors of the Federal Reserve System through February 1997, and then to chair the Council of Economic Advisers through August 1999. She chaired the Economic Policy Committee of the Organization for Economic Cooperation and Development from 1997 to 1999. She served as president and chief executive officer of the Federal Reserve Bank of San Francisco from 2004 to 2010.
Yellen is a member of the Council on Foreign Relations and has served as president of the Western Economic Association, vice president of the American Economic Association, and a fellow of the Yale Corporation.