(The Washington Post) — Federal Reserve Chair Janet L. Yellen earned widespread approval for her term at the helm of the U.S. central bank, a singularly powerful job in the global economy. On her watch, unemployment fell sharply — reaching 4.1 percent in October, the lowest point since 2000, the government reported Friday. Inflation stayed subdued, wages began to rise, and she managed a gradual start to the Fed’s unwinding of its $4.5 trillion balance sheet, a tricky task that could have undercut growth if mishandled.
Yet despite all that, Trump announced Thursday he would not name Yellen — the first woman to hold the post — for a second term when her tenure expires at the end of January. That is a break with the tradition — the previous three men to the hold the job were reappointed by presidents of opposing parties. And Trump isn’t choosing to replace her with someone with a much different vision, either. He tapped Jerome Powell, a mild-mannered Fed governor with far less experience working on economic issues who is expected to stay the course that Yellen set. Trump rejected others who would have been a break with Yellen’s approach.
“This is stunningly unusual,” Peter Conti-Brown, a financial historian who studies the Fed at the University of Pennsylvania’s Wharton School.
It also, according to some female economists, sends a message to others who may want to follow in Yellen’s footsteps. “Janet Yellen was known to be the hardest-working person around: She set the bar so high, and as a result of her hard work she was ahead of the curve on so many things,” said Julia Coronado, president of MacroPolicy Perspectives and a former Fed staff member. “Despite that, she’s not getting the job back. What is a young woman economist supposed to make of that? That I can work harder than anybody else and be smarter than people around me and get fired? That’s a tough message.” Read more here.