Janet Yellen Will Be the First Female Treasury Secretary

Mish

Former Fed Chair Janet Yellen will be the first woman to hold job if confirmed by the Senate.

Another First for Yellen

Ms. Yellen, who was the first woman to lead the Fed, would become the first person to have headed the Treasury, the central bank and the White House Council of Economic Advisers.

Separately, Mr. Biden’s transition team said he would nominate Alejandro Mayorkas to lead the Department of Homeland Security and Avril Haines as director of national intelligence. Former Secretary of State John Kerry will serve as special presidential envoy for climate change.

Ms. Yellen has said recently the recovery will be uneven and lackluster if Congress doesn’t spend more to fight unemployment and keep small businesses afloat. “There is a huge amount of suffering out there. The economy needs the spending,” Ms. Yellen said in a Sept. 28 interview.

One of Ms. Yellen’s first decisions could be to decide whether to reactivate and potentially revamp, with Mr. Powell’s approval, a series of lending backstops the Fed and Treasury launched when the coronavirus pandemic convulsed markets this spring.

The parameters of one of those programs—to buy loans extended to small- and midsize businesses—might be “insufficiently generous,” she said. The Main Street Lending Program has extended just $4 billion in credit to more than 400 companies in its first four months of operation.

Treasury Secretary Steven Mnuchin decided last week that the programs would cease the purchase of loans or assets at the end of the year, declining an extension that had been sought by the Fed. The Biden transition team criticized Mr. Mnuchin’s decision.

Mnuchin May Be Right

Powell agrees to return unused relief money to Treasury at year end following Mnuchin’s decision.

Please consider Carnival Borrowing Without Ships Suggests Mnuchin May Be Right

Hours after U.S. Treasury Secretary Steven Mnuchin called for emergency lending programs to be allowed to expire, corporate bond investors continued to flood Carnival Corp.’s bankers with more than $11 billion in orders for debt that comes with no collateral protection.

For some, it was a sign that credit markets aren’t so fragile after all. After roughly $2 trillion of borrowing helped U.S. companies bolster their balance sheets with cash to weather the pandemic, investors have grown increasingly confident -- perhaps even complacent -- that the widespread corporate failures predicted by many earlier this year have largely been avoided. Granted, the Fed helped fuel nearly all of that debt issuance, and the investor demand supporting it. 

And even if the immediate lifeline of $580 billion in backstop money is returned by the Federal Reserve to the Treasury, traders are betting that markets will fare just fine, anticipating that the government will step in again if new signs of stress emerge. 

Hasn't the Fed Made Enough Mistakes?

The Fed has blown four economic bubbles in succession keeping interest rates too low, too long.

Former Fed Chair Yellen pledges to continue this path, this time as Treasury Secretary supportive of the Fed.

Mish

Comments (19)
No. 1-12
Lance Manly
Lance Manly

"The Fed has blown four economic bubbles in succession keeping interest rates too low, too long."

So who is opposing them?

RunnerDan
RunnerDan

"Former Fed Chair Yellen pledges to continue this path, this time as Treasury Secretary supportive of the Fed."

But I've been told many, many, many times that "diversity is our strength" and that we need to listen to the voices that had supposedly been suppressed prior to the last 50 years, so that we can gain a fresh, new perspective to everyone's benefit. So, what are we celebrating with this first woman Treasury Secretary?

Doug78
Doug78

I believe that the FED has been studying for a few years now methods of sending money directly into peoples' bank accounts bypassing state and other federal agencies. It would eliminate the middleman and make it impossible for the states and maybe Congress to control who gets what. The fatal flaw of the 2008 policy was that it threw money at the top and hoped it would trickle down but of course it didn't. This time to stimulate the economy they will send money directly to those who can use it. It is an aggressive approach. I wonder if they will do it.

Curious-Cat
Curious-Cat

This is a reminder of what I don't like about Joe Biden.

Eddie_T
Eddie_T

Don’t be fooled by the Ayn Rand hairdo.

Rhet
Rhet

In all likelihood immigration is going to be substantially restricted going forward. The birth rate is down to 1.77 births per women. A Japan has found, a shrinking population is massively deflationary. Is inflation really a risk at this point?

Tengen
Tengen

Yellen and Mnuchin might as well be the same person. This is why some of us make fun of red/blue politics so much. The rhetoric on wedge issues changes but the economic policy remains the same.

anoop
anoop

yay, good times on the way for stonks.

(wait a minute. it's been good times all along!)

KidHorn
KidHorn

No matter who's selected, the national debt is going to skyrocket along with the FEDs balance sheet. Trump will take the blame.

davebarnes2
davebarnes2

Does this mean we get a male as US Treasurer?
We have not had one since I was born.

amigator
amigator

Interesting Nomination. Currently the Demmicats are trying to defeat Judy Shelton on the grounds that she would compromise the independence of the Fed from the Treasury. JB's move practically makes a merger!

You can't make this stuff up.

2thguy
2thguy

Who cares what set of genitalia Treasury Secretary has?


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