Hello everyone, and Happy New Year! We are sure you have noticed that updates to LOLFED are few and far between these days. We have a New Year’s resolution to try to rectify that. Of course, our resolutions last about a week and then it’s back to the usual neglect. But we hope 2014 started off well for you.
What’s new? Well, Benny is leaving. So sad to see him go; he gave us lots of material, after all. But we just learned that Janet Yellen, former President of the Federal Reserve Bank of San Francisco and recently Vice Chairperson of the Federal Reserve System, has been confirmed to succeed Benny as Chairperson of the FED. According to the story in Politico, the U.S. Senate voted 56-26 on Monday to confirm the appointment. As you recall, President Obama nominated her on October 9 of last year.
Yellen will start her new gig on February 1st and she will be the first woman to head the FED in its first century of existence. Obama said that Yellen “sounded the alarm bell early about the housing market bubble and excesses in the financial markets before the recession. She calls it like she sees it.” A speech she gave in San Francisco in 2005 confirms that she was indeed aware of a housing bubble, but as you can see, she thought “the economy would be able to absorb the shock” of a deflation, comparing it to a “bump in the road.” Good call, Janet.
As Zero Hedge states, Janet will be taking over at a time of “pivoting policy.” But personally, I have yet to see a true taper. The so-called tapering that happened last month means that Q.E. is reduced from $85 billion per month to “only” $75 billion. Wow, such courage!
So how will Janet run things in 2014? Will she, as Gary Kaltbaum suggests, “make Bernanke look like Paul Volcker”? Will the new boss be the same as the old boss? I guess we’ll find out.
- Bill G
P.S. : I guess that leaderboard will have to change… again…