Janet Yellen: Will This Economics Superstar Be the First Female Chair of the Federal Reserve?

Fame does not always accompany power. For proof of that, just ask Janet Yellen — a woman who, despite relative obscurity, will probably become the world's most powerful woman in the coming months.

While one cannot say for certain, all signs point to Yellen's ascendancy. After all, long-time head of the Federal Reserve Ben Bernanke will soon be stepping down. What's more, he has decided to skip this August's Jackson Hole summit of bankers, where he would normally be responsible for delivering the main speech. Who will be speaking in his place? Janet Yellen.

Because of this tidbit and others given by the Obama administration and those in the know, Federal Reserve Vice Chairwoman Yellen is currently billed as the clear frontrunner to replace Bernanke by almost every major media outlet and economic analyst. If Obama selects her, she would become the first woman ever to chair the male-dominated Federal Reserve, which would put her at the head of an organization that has an unnerving amount of power when it comes to shaping Western monetary policies.

Though Yellen may have avoided the media spotlight until now, her career is certainly notable. Before becoming the Fed's Vice Chairwoman, Yellen was president and chief executive officer of the Federal Reserve Bank of San Francisco, professor emerita at Berkeley's Haas School of Business, and the head of the White House Council of Economic Advisors under President Bill Clinton.

So how might Yellen be different from Bernanke? From what I've gleaned, it seems likely that she will take an (even more) intellectual approach towards economics than Bernanke — no surprise given her academic background. The more controversial shift in leadership involves which issues she emphasizes, as well as which issues she doesn't emphasize.

"I think people read Janet Yellen's speeches as saying that she puts a higher weight on joblessness compared to inflation" than others in the Fed, said Vincent Reinhart, the chief United States economist at Morgan Stanley. "And that includes Ben Bernanke."

If nominated, Senate Republicans worried about inflation would no doubt latch onto this issue. Nonetheless, all indications (as of now) are that if nominated, Yellen would probably be confirmed. This would probably be helped by her personality and her rational approach toward economics — one that even her ideological opponents find likeable.

As the New York Times reported, even Alan Greenspan, perhaps the most visible opponent of Yellen ideologically, said that he holds Yellen in very high regard. "I did listen to her more carefully [when I worked with her] because she articulates her position in a way that you can follow it analytically," he said in an interview. "Intuitions are useless. Janet's conversation and her presentations were factually based, and that always got my attention."

Whatever the case, a small, soft-spoken, somewhat nerdy, white-haired woman — described by one colleague as "a small lady with a large I.Q." — is about to become what one could reasonably call the most powerful woman in the world.

And though almost no one knows who Yellen is as of now, I have a feeling that is about to change.

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Michael Shammas

Second-year Harvard Law student, politico, Breaking Bad fan, cynical idealist, coffee addict, & Duke sports fanatic. Contact me at mshammas@jd16.law.harvard.edu.

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