If Janet Yellen weren't already the presumptive successor to Federal Reserve
Chairman Ben Bernanke, she is now, following the most recent Wall Street Journal
poll of economists.
Thirty-five of 42 business and academic economists responding to a Journal survey said that the current Fed vice chair and former Federal Reserve Bank of San Francisco president should take over from Bernanke when his term expires in January. Earlier Reuters and Bloomberg polls showed similar results.
Ultimately the choice of head for the central bank is President Obama's, but it would be difficult for him to overlook the 66-year-old Yellen.
Yellen, who took her current post in 2010, is known as one of the top "doves" on monetary policy, preferring low interest rates. She's been a reliable ally of Bernanke and has a long record of being a team player. In her time as a voting member of the Fed's monetary policy committee, which includes her tenure as San Francisco Fed president from 2004 to 2010 and a mid-'90s stint on the Fed's Board of Governors, Yellen never dissented from a Fed policy decision.
The Fed chairmanship is a nonpartisan post, but Yellen, a Democrat who ran President Bill Clinton's Council of Economic Advisers from 1997 to 1999, would be taking over from the Bush- appointed Bernanke. Her academic background would serve her well in the current economic climate: Her most famous research examines labor markets, unemployment and inequality. Yellen, who has a doctorate from Yale and taught at Berkeley, also would be a package deal: She is married to George Akerlof, a Nobel Prize-winning economist who is her frequent co-author in academic work.
If Yellen were to succeed Bernanke, she would become the first female chairman of the Fed. Not only would that make her one of the most powerful women in the world, it would put her on top of the world in both finance and academic economics, two fields traditionally dominated by men.
Yellen is not the only candidate for the Fed's top job. The Irish betting market PaddyPower gives Roger Ferguson, the CEO of TIAA- CREF who served as Fed vice chairman from 1999 to 2005, the second highest odds. Some insider reports have suggested the White House favors former Harvard president and Obama and Clinton top adviser Larry Summers.
One factor that would favor Yellen over any outsider is the need for continuity after Bernanke leaves. The Fed has outlined a specific timeline for monetary policy, one that includes an end to stimulus purchases next year and an increase in interest rates in 2015. The appointment of someone who wasn't involved in developing that program could sow doubt about the Fed's commitments to its plans, undermining the bank's credibility and endangering the already tepid economic recovery.
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