Janet Yellen

"Yellen" redirects here. For other people with this surname, see Yellen (surname).

Janet Yellen
78th United States Secretary of the Treasury
Assuming office TBD
President	Joe Biden (elect)
Deputy	Wally Adeyemo (nominee)
Succeeding	Steve Mnuchin
15th Chair of the Federal Reserve
In office February 3, 2014 – February 3, 2018
President	Barack Obama Donald Trump
Deputy	Stanley Fischer
Preceded by	Ben Bernanke
Succeeded by	Jerome Powell
Vice Chair of the Federal Reserve
In office October 4, 2010 – February 3, 2014
President	Barack Obama
Preceded by	Donald Kohn
Succeeded by	Stanley Fischer
Member of the Federal Reserve Board of Governors
In office October 4, 2010 – February 3, 2018
President	Barack Obama Donald Trump
Preceded by	Mark W. Olson
Succeeded by	Vacant
In office August 12, 1994 – February 17, 1997
President	Bill Clinton
Preceded by	Wayne Angell
Succeeded by	Edward Gramlich
President of the Federal Reserve Bank of San Francisco
In office June 14, 2004 – October 4, 2010
Preceded by	Robert Parry
Succeeded by	John Williams
18th Chair of the Council of Economic Advisers
In office February 18, 1997 – August 3, 1999
President	Bill Clinton
Preceded by	Joseph Stiglitz
Succeeded by	Martin Baily
Personal details
Born	Janet Louise Yellen (1946-08-13) August 13, 1946 Brooklyn, New York City, U.S.
Political party	Democratic
Spouse	George Akerlof
Children	1
Education	Brown University (AB) Yale University (MA, PhD)
Signature

Janet Louise Yellen (born August 13, 1946) is an American economist at the Brookings Institution and a professor emeritus at the University of California, Berkeley, Haas School of Business. She served as the Chair of the Federal Reserve from 2014 to 2018, and as Vice Chair from 2010 to 2014. She was the first woman to head the Federal Reserve.

Yellen was a Federal Reserve Board Governor from 1994 to 1997 and again from 2010 to 2018. She served as the 18th Chair of the White House Council of Economic Advisers under President Bill Clinton from 1997 to 1999. She was President of the Federal Reserve Bank of San Francisco from 2004 to 2010.

In 2014, Yellen was nominated by President Barack Obama to succeed Ben Bernanke as chair of the United States Federal Reserve. She served one four-year term as Federal Reserve Chair from 2014 to 2018 and was not reappointed by President Donald Trump.

In addition to her continued contributions to the field of economics, Yellen is also noted for breaking down many gender barriers as a woman in the field. President-elect Joe Biden has announced he will nominate Yellen to serve in the Cabinet as the United States Secretary of the Treasury.

Early life and education

Yellen was born in a Polish Jewish family in the Bay Ridge neighborhood of New York City's Brooklyn borough, where she also grew up. Her mother was Anna Ruth (née Blumenthal; 1907–1986), an elementary school teacher, and her father Julius Yellen (1906–1975), a family physician, who worked from the ground floor of their home. Her mother quit her job to take care of Janet and her older brother, John. She graduated from local Fort Hamilton High School as a valedictorian.

Yellen graduated summa cum laude from Pembroke College in Brown University with a degree in economics in 1967. At Brown, she switched her planned major from philosophy to economics and was particularly influenced by professors George Borts and Herschel Grossman. She received her Ph.D. in economics from Yale University in 1971. Her dissertation was titled "Employment, Output and Capital Accumulation in an Open Economy: A Disequilibrium Approach" under the supervision of (later to be) Nobel laureates James Tobin and Joseph Stiglitz, who has called Yellen one of his brightest and most memorable students. Two dozen economists earned their Ph.D from Yale in 1971, including Uri Possen and Gary Smith, but Yellen was the only woman in that doctoral class.

Career

Early career

After receiving her doctorate, Yellen was an assistant professor at Harvard from 1971–76. In 1977, she was recruited to become an economist with the Federal Reserve Board of Governors by Ted Truman, who had known Yellen from Yale. Truman was a junior professor at Yale and heard her oral exam, and had recently taken over the Fed's Division of International Finance. She was assigned to research international monetary reform.

While at the Fed, she famously met her husband George Akerlof in the central bank's cafeteria and the two were hastily married. However, Akerlof had already accepted a teaching position at the The London School of Economics and Political Science, where Yellen would also land a position as a lecturer. Beginning in 1980, Yellen joined the faculty at the University of California, Berkeley to conduct macroeconomics research and teach MBA and undergraduate students. She is now a Professor Emerita at the University of California, Berkeley's Haas School of Business where she was named Eugene E. and Catherine M. Trefethen Professor of Business and Professor of Economics. Twice she has been awarded the Haas School's outstanding teaching award.

Public service

In August 1994, Yellen took leave from Berkeley for five years. Bill Clinton appointed her as a member of the Federal Reserve Board of Governors, where she served from August 12, 1994 to February 17, 1997. Yellen then became Chair of President Clinton's Council of Economic Advisers from February 18, 1997, to August 3, 1999. While at the CEA, she also chaired the Economic Policy Committee of the Organization for Economic Cooperation and Development from 1997–1999. During her time with the Council of Economic Advisors, Yellen oversaw a landmark study focused on the gender pay divide in June 1998. Within this study, the Council analyzed data from 1969 to 1996 to determine the cause for women to earn substantially less than men. By observing trends attributable to issues like occupation/industry as well as familial status, it was determined that while the Equal Pay Act of 1963 was a step forward, there was no explanation as to why there was a 75 percent difference between average pay for women and men. It was concluded that this gap had no correlation with differences in productivity and, as such, was the repercussions of discrimination within the workforce. Yellen served as president of the Western Economic Association International and is a former vice president of the American Economic Association. She was a fellow of the Yale Corporation from 2000 to 2006.

Federal Reserve Bank of San Francisco

From June 14, 2004, until 2010, Yellen was the President and Chief Executive Officer of the Federal Reserve Bank of San Francisco. She was a voting member of the Federal Open Market Committee (FOMC) in 2009. Following her appointment to the Federal Reserve in 2004, she spoke publicly and in meetings of the Fed's monetary policy committee, about her concern about the potential consequences of the boom in housing prices. However, Yellen did not lead the San Francisco Fed to "move to check [the] increasingly indiscriminate lending" of Countrywide Financial, the largest lender in the U.S.

In a 2005 speech in San Francisco, Yellen argued against deflating the housing bubble because "arguments against trying to deflate a bubble outweigh those in favor of it" and predicted that the housing bubble "could be large enough to feel like a good-sized bump in the road, but the economy would likely be able to absorb the shock." In 2010, Yellen told the Financial Crisis Inquiry Commission that she and other San Francisco Fed officials looked for guidance from Washington because "she had not explored the San Francisco Fed's ability to act unilaterally," according to the New York Times. Yellen conceded her previous misjudgment of the housing crisis to the Commission: "I guess I thought that similar to the collapse of the stock market around the tech bubble, that most likely the economy could withstand [the housing collapse] and the Fed could move to support the economy the way it had after the tech bubble collapsed."

In July 2009, Yellen was mentioned as a potential successor to Ben Bernanke as chair of the Federal Reserve System, before he was renominated by Barack Obama.

Vice-chair of the Federal Reserve

Yellen sworn in by Fed Chairman Ben Bernanke in October 2010

On April 28, 2010, President Obama nominated Yellen to succeed Donald Kohn as vice-chair of the Federal Reserve System. In July, the Senate Banking Committee voted 17–6 to confirm her, though the top Republican on the panel, Senator Richard Shelby of Alabama, voted no, saying he believed Yellen had an "inflationary bias". At the same time, on the heels of related testimony by Fed Chairman Bernanke, FOMC voting member James B. Bullard of the St. Louis Fed made a statement that the U.S. economy was "at risk of becoming 'enmeshed in a Japanese-style deflationary outcome within the next several years.'"

Bullard's statement was interpreted as a possible shift within the FOMC balance between inflation hawks and doves. Yellen's pending confirmation, along with those of Peter A. Diamond and Sarah Bloom Raskin to fill vacancies, was seen as possibly furthering such a shift in the FOMC. All three nominations were seen as "on track to be confirmed by the Senate."

On October 4, 2010, Yellen was sworn in for a four-year term that ended on October 4, 2014. Yellen has been an outspoken advocate for using the powers of the Federal Reserve to reduce unemployment, and has seemed more willing than other economists to risk slightly higher inflation to accomplish this goal. Yellen simultaneously began a 14-year term as a member of the Federal Reserve Board that will expire on January 31, 2024.

Chair of the Federal Reserve

Yellen speaks at FOMC press conference in 2014

Yellen speaks with IMF Managing Director Christine Lagarde in 2014

On October 9, 2013, Yellen was officially nominated to replace Bernanke as Chair of the Federal Reserve, the first vice chair to be elevated. During the nomination hearings held on November 14, 2013, Yellen defended the more than $3 trillion in stimulus funds that the Fed had been injecting into the U.S. economy. Additionally, Yellen testified that U.S. monetary policy is to revert towards more traditional monetary policy once the economy is back to normal.

On December 20, 2013, the U.S. Senate voted 59–34 for cloture on Yellen's nomination. On January 6, 2014, she was confirmed as Chair of the Federal Reserve by a vote of 56–26, the narrowest margin ever for the position. In addition to being the first woman to hold the position, Yellen is also the first Democratic nominee to run the Fed since Paul Volcker became chairman in 1979. After being elected by the Federal Open Market Committee as its chair on January 30, 2014, she took office on February 3, 2014.

On December 16, 2015, while Yellen was chair of the Federal Reserve, the latter increased its key interest rate for first time since 2006. Once in office, Yellen began the process of reversing some of the policies that had been enacted in response to the subprime mortgage crisis of 2008. Notably, she oversaw a program to sell Treasury and mortgage bonds that the Fed had purchased to stimulate the economy. Her tenure was also noted for job and wage growth, both of which occurred while she maintained low interest rates.

After the election of President Donald Trump in November 2016, Yellen vowed to protect Dodd-Frank.

On June 27, 2017, Yellen generated controversy when she stated that she did not expect another financial crisis "in our lifetime." Yellen explained that this assumption can be made due to her belief that banks are "very much stronger" as a result of Federal Reserve oversight. Tim Price of the Mises Institute compared her remarks to John Maynard Keynes' claim that "We will not have anymore crashes in our time." On December 11, 2018 Yellen later warned of the possibility of a financial crisis by citing "gigantic holes in the system" after her departure from the Federal Reserve.

Trump considered renominating Yellen for another term, but on November 2, 2017 nominated Jerome Powell to succeed Yellen when her term ended on February 3, 2018. Yellen's height was reportedly a factor in Trump's decision. After Trump's decision, Yellen announced that she would leave the Federal Reserve Board of Governors at the end of her term as chair.

After the Federal Reserve

Yellen delivers her farewell speech to Federal Reserve staff in 2018

On February 2, 2018, the Brookings Institution announced that Yellen would be joining the think tank as a Distinguished Fellow in Residence. She will be affiliated with the Hutchins Center on Fiscal and Monetary Policy, joining her predecessor and former Federal Reserve Chair Ben Bernanke.

Yellen was one of the signees of a 2018 amici curiae brief that expressed support for Harvard University in the Students for Fair Admissions v. Harvard lawsuit. Other signees of the brief include Alan B. Krueger, Robert M. Solow, George A. Akerlof, Cecilia Rouse, as well as numerous others.

On February 25, 2019, Yellen criticized Trump's economic policies. When asked if she believes Trump has "a grasp of economic policy", Yellen said "No, I do not." In the interview with Marketplace, Yellen explained that she doubts that Trump could articulate the Federal Reserve's explicit goals of "maximum employment and price stability." Yellen pointed out Trump's claims that the Federal Reserve's goals involve trade, which she explains to be objectively false. This interview was a change in tone for Yellen, who traditionally handled her differences with Trump in a neutral manner.

In November 2020, President-elect Joseph Biden announced he would nominate Yellen to serve as Secretary of the Treasury. She would be the first woman to hold this position if confirmed by the Senate.

Economic philosophy

Yellen with Mario Marcel in 2017

Yellen is considered by many on Wall Street to be a "dove" (more concerned with unemployment than with inflation) and as such to be less likely to advocate Federal Reserve interest rate hikes, as compared, for example, to William Poole (former St. Louis Fed president) a "hawk". However, some predicted Yellen could act more as a hawk if economic circumstances dictate.

Yellen is a Keynesian economist and advocates the use of monetary policy in stabilizing economic activity over the business cycle. She believes in the modern version of the Phillips curve, which originally was an observation about an inverse relationship between unemployment and inflation. In her 2010 nomination hearing for Vice Chair of the Federal Reserve Board of Governors, Yellen said, "The modern version of the Phillips curve model—relating movements in inflation to the degree of slack in the economy—has solid theoretical and empirical support." Prior to having made that statement however, Yellen gave a speech in 2007 as President of the Federal Reserve Bank of San Francisco where she is quoted as saying, "I have supported the decision to hold policy steady at the current rate despite inflation remaining higher than I would like it to be. Let me be clear that I do want inflation to move down, but as I just indicated with my forecast, I believe policy may now be well-positioned to foster exactly such an outcome."

Honors and awards

Treasury Secretary Jack Lew and Federal Reserve Chair Janet Yellen

Yellen received the Wilbur Cross Medal from Yale in 1997, an honorary Doctor of Laws degree from Brown University in 1998, and an honorary Doctor of Humane Letters from Bard College in 2000. She received an Honorary Doctorate from the London School of Economics in May 2015, making her and her husband George Akerlof "the first wife and husband team to hold honorary doctorates from the School".

In October 2010, she received the Adam Smith Award from the National Association for Business Economics (NABE). In 2012, she was elected Distinguished Fellow of the American Economic Association. In September 2012, she was included in the 50 Most Influential list of Bloomberg Markets magazine.

In 2014, she was named by Forbes as the second most powerful woman in the world after Chancellor Angela Merkel. She was the highest-ranking American on the list. In May 2015, Yellen received an honorary Doctor of Social Science degree from Yale University.

In October 2015, Yellen received an honorary Doctor of Laws degree from the University of Warwick. In October 2015, Sovereign Wealth Fund Institute ranked Janet Yellen #1 in the Public Investor 100 list and Bloomberg Markets ranked Janet Yellen first in their annual list of the 50 most influential economists and policymakers.

On May 27, 2016, at the Radcliffe Day luncheon during Commencement week, Yellen received an honorary Radcliffe Medal and spoke to guests.

External service and assignments

• President, American Economic Association, 2020
• Vice President, American Economic Association, 2004
• President, Western Economics Association, 2004
• Fellow, American Academy of Arts and Sciences, 2001
• Vice President, Western Economics Association, 2001
• Chair: Economic Policy Committee of the Organization for Economic Cooperation and Development 1997–1999
• Adviser: Congressional Budget Office
• Trustee of the Economists for Peace and Security
• Board Member of the Committee for a Responsible Federal Budget
• Senior member of Group of Thirty

Personal life

Yellen is married to George Akerlof, economist, Nobel Memorial Prize in Economic Sciences laureate, professor at Georgetown University, and professor emeritus at the University of California, Berkeley. Yellen and Akerlof had met at the Fed in the fall of 1977, married in June 1978. In June 1981, their son Robert Akerlof was born. Robert Akerlof now teaches economics at the University of Warwick.

Yellen and Akerlof have collaborated on research, including topics such as poverty, unemployment and a paper on the costs of out-of-wedlock childbearing. Both frequently state that their lone disagreement is that she is a bit more supportive of free trade than he is.

See also

• Everything bubble

Selected works

Books

• Yellen, Janet L.; Blinder, Alan S. (2001). The Fabulous Decade: Macroeconomic Lessons from the 1990s. New York: The Century Foundation Press. ISBN 0-87078-467-6. OCLC 47018413.

Articles

• "Hong Kong and China and the Global Recession," FRBSF Economic Letter (2010).
• "Explaining Trends in the Gender Wage Gap," The Council of Economic Advisors (1998).

• "East Germany In From the Cold: The Economic Aftermath of Currency Union" (with George Akerlof, Andrew Rose, and Helga Hessenius), Brookings Papers on Economic Activity 1991:1.
• "How Large are the Losses from Rule of Thumb Behavior in Models of the Business Cycle?" (with George Akerlof) in William Brainard, William Nordhaus, and Harold Watts, eds., Money, Macroeconomics and Economic Policy: Essays in Honor of James Tobin, Cambridge, Mass.: MIT Press (1991). ISBN 0-262-02325-3
• "An Analysis of Out-of-Wedlock Childbearing in the United States," (with George Akerlof and Michael Katz). Quarterly Journal of Economics (May 1996); adapted into a Policy Brief prepared for the Fall 1996 issue of the Brookings Review doi:10.2307/2946680
• "Monetary Policy: Goals and Strategy," Business Economics (July 1996).
• "Trends in Income Inequality and Policy Responses," Looking Ahead, October 1997; reproduced in James Auerbach and Richard Belous, eds., The Inequality Paradox: Growth of Income Disparity, National Policy Association, 1998
• "The Continuing Importance of Trade Liberalization," Business Economics (1998).
• Rose, Andrew K. & Yellen, Janet L., 1989. "Is there a J-curve?," Journal of Monetary Economics, Elsevier, vol. 24(1), pages 53–68, July.
• Akerlof, George A., and Janet Yellen, 1986. "Efficiency Wage Models of the Labor Market". Orlando, Fla.: Academic Press.
• Yellen, Janet L, 1984. "Efficiency Wage Models of Unemployment," American Economic Review, American Economic Association, vol. 74(2), pages 200–205
• McCulloch, Rachel & Yellen, Janet, 1982. "Can capital movements eliminate the need for technology transfer?," Journal of International Economics, Elsevier, vol. 12(1–2), pages 95–106, February.

External links

• Janet L. Yellen at the Federal Reserve System
• Publications at the National Bureau of Economic Research
• Appearances on C-SPAN
• Janet Yellen at IMDb
• Janet Yellen collected news and commentary at The Guardian