The United States Senate confirms President Trump’s pick for chairman of the Federal Reserve, Jerome Powell. Jerome Powell is currently the Federal Reserve Board Governor under Yellen. The confirmation vote was 84-13 and was held on Tuesday, January 23, 2018. Likewise, this positive outcome was to be expected since both Republicans and Democrats alike expect that Powell will continue current policies of the departing chairwoman Janet Yellen.
However, prior to Powell taking over. Current Fed Chair Yellen will hold her final policy meeting on Wednesday in which it is said that the material to be covered is that of continuing the current and steady rise on interest rates. Likewise, in these meetings it has been determined that the United States will see a tightening of monetary policy due to the current expansion of the economy and the current job growth. Moreover, according to NPR, “Some analysts expect interest rates to increase in March.” Furthermore, analyst have stated that they don’t see or believe that there will be any dramatic shift in policy once Jerome Powell takes the reigns as the next Fed Chair in the next few days.
Jerome Powell is sixty-four years of age and is a Princeton-trained former investment banker. Likewise, Powell was a partner at the Washington -based private equity firm The Carlyle Group and he does not hold an advanced degree in Economics, which is out of the ordinary for the Fed chair position as for the past 40 years Fed chairs have had an advanced degree in Economics. However, Powell was originally appointed by President Obama to the fed board five and a half years ago. Likewise, this appointment is quite surprising as Trump has deterred from tradition in that it is “the first time in decades that a president hasn’t reappointed a chief of the central bank for a second term”, as NPR reports it. However, as the Federal Reserve Governor Powell has backed the current policies of Yellen, which is the gradual increase of interest rates. Furthermore, during a speech at the Economic Club of New York Powell is quoted to have stated that “’If the economy performs about as expected, I would view it as appropriate to continue to gradually raise rates.”
Furthermore, many analysists assume that Powell will continue the gradual increase in the interest rates that the banks are witnessing with Yellen at the helm. However, there is some transformation between Powell and Yellen and that difference lays in Bank registration because he believes that the Dodd-Frank reforms should be streamlined in certain areas. This is due to Powell supporting less regulatory weights on banks, unlike Yellen. Yet, in Congress Powell is viewed as a centrist, which is defined as one who holds moderate political assessments.
Furthermore, the thirteen votes against Powell becoming the successor of Yellen as the next Fed Chair were four Republicans and eight Democrats plus Bernie Sanders who is an independent who usually votes with the Democrats. A notable Democrat that was one of the eight was Senator Elizabeth Warren, D-Mass. Warren’s reason for the no vote on Powell was because she is deeply concerned that Powell will rescind current policies that assist in safeguarding the United States in entering another potential financial crisis like the previous one that we witnessed in 2007-2008. Yet, the top Democrat on the Senate banking committee Sen. Sherrod Brown has stated that Powell’s tenure on the Federal Reserve’s board and stated that Powell’s “track record over the past six years shows he is a thoughtful policymaker.” Concludingly, Powell was also an undersecretary of the Treasury during the presidency of President George H.W Bush.