Why Janet Yellen Will Craft the Greatest Fedspeak Ever

NEW YORK (TheStreet) -- Call it a gift of Fedgab, because Janet Yellen has it.

Former Federal Reserve Chairman Alan Greenspan was known for his so-called Fedspeak, which was a term often used about the central banker when he was intentionally ambiguous communicating Fed policy to markets.

It was a tactic that current Chairman Ben Bernanke jettisoned as the U.S. economy rebounded from the worst recession since the Great Depression, particularly to communicate to fragile global markets how the Fed was supporting the recovery.

"That is the virtue, I think, of Yellen," said David Weiman, an economics professor at Barnard College.

Economists and analysts in interviews about Yellen, who President Obama nominated on Wednesday to be Bernanke's successor, said one of the central banker's strongest qualities is her ability to clearly communicate complex monetary policy.

Throughout her years as the San Francisco Fed president and as the vice chair of the Board of Governors, Yellen has delivered speech after speech that avoids typical Fed jargon. Before her Fed days, Yellen wrote with economist Alan Blinder about the macroeconomic lessons during the Bill Clinton presidency, called "The Fabulous Decade."

"It's extremely well written, it's thoughtfully analyzed and it actually conveys a sophisticated message and it does so in terms that the educated layperson can certainly understand," said Weiman.

As an example of her ability to explain difficult subjects, Yellen on April 16, 2009, during the throes of the recession, delivered a speech about asset bubbles and the work of Hyman Minsky. Minksy's research focused on financial crises, and it was better-known for addressing "asset price bubbles."

If you liked this article you might like

Monster Beverage Stock Soars as Coca-Cola Opens Refreshing Partnership

Gold Pares Losses as Ukraine Says Its Troops Attack Russian Convoy

Cisco Stock Biggest Dow Loser as Company Cuts 6,000 Jobs

Gold Demand Slumps as Increasing Prices Slow Asian Demand

Gold Demand Shrinks a Year After the Infamous Market Collapse