Looks like my favorite pick for Fed chair is getting the runner-up job: San Francisco Fed President Janet Yellen will replace retiring Vice Chair Donald Kohn. It's good news, since Yellen takes seriously the full employment part of the Fed's mandate, which is what we need in a time when inflation is currently, um, pretty much nonexistent. Brad DeLong is pleased but recognizes that little will change on the committee that sets monetary policy, since Yellen is already a member.
Apparently, nominees for the two other open seats on the Fed's board have also been picked, but it's unclear who they are; some reports say Sarah Raskin, Maryland's top banking regulator, is a contender for the spot. I met Raskin a few weeks ago at the New America Foundation and found her to be very consumer-oriented. She's also a realist about the banking industry, which could be a huge asset if the Fed continues to play a large role in financial regulation, as expected.
For who should be picked, this Mark Thoma post does a good job laying out what's needed. Basically, liberal economists who will question the dominance of a doctrinaire belief in the free market that still, somehow, lingers on from the days of Alan Greenspan.
-- Tim Fernholz
