Janet Yellen 'most qualified person' to head US Federal Reserve

Janet Yellen 'most qualified person' to head US Federal Reserve
President Obama applauds after announcing his nomination of Dr Janet Yellen. She had chaired the White House Council of Economic Advisers and it vice-chairman at the Fed.

When a massive earthquake rocked Northern California in 1989, Dr Janet Yellen was in the same room at the University of California at Berkeley as Professor Andrew Rose.

"We thought the building was going to collapse and I was convinced we were going to die," Prof Rose told the BBC recently, recalling his own terror during the quake that registered 6.9 on the Richter scale, killed 63 people and injured nearly 4,000. "Janet just stayed remarkably calm during the whole thing."

At the time, Dr Yellen was a colleague of Prof Rose at the university's Haas School of Business. Since then, she has moved on - and upwards.

Last week, United States President Barack Obama nominated her to succeed Dr Ben Bernanke as the next chairman of America's Federal Reserve, or the Fed as the central bank is informally known.

The kind of unflappability Dr Yellen displayed during that San Francisco area earthquake is expected to serve her well if she is confirmed. She would head the Fed at a time when the global economy has been shaken by a US government shutdown, slowdowns in China and India, and uncertainty in Europe.

In nominating Dr Yellen, Mr Obama himself said "she's tough" - a quality that seems to be belied by her white-haired 67 years, at least on the surface.

Some of the rough and tumble New York city borough of Brooklyn, where she was born in 1946, seems to have rubbed off on her. She exuded self-confidence early on. At Fort Hamilton High School, it was the annual tradition of the student newspaper's editor to interview the class valedictorian. The young Janet Yellen was both, so she simply interviewed herself, according to The New York Times.

She went on to major in economics at Brown University. A speech by economist James Tobin, said the Times, inspired her to earn a doctorate in that discipline at Yale University in 1971.

Dr Tobin has been her intellectual hero ever since, the Times said. Not only did she buy into his defence of the view that government policy can lift an economy from recession, but she also admired the way he took time to perform public service as well as pursue his academic work.

When he died in 2002, she revealed to the New York Daily News how his career had inspired her own. "He encouraged his students to do work that was about something," she said. "Work that would not only meet a high intellectual standard, but would improve the well-being of mankind."

Similar views are shared by her husband, Professor George Akerlof, a winner of the 2001 Nobel Prize in Economics. He is a noted behavioural economist who incorporates anthropology, psychology and sociology in his work.

As the Times and other newspapers have reported, the couple paid their babysitter more than the going rate in the 1980s because they believed that would inspire her to provide better care for their son.

That seems to have had the desired effect. Robert followed in his parents footsteps and grew up to be an assistant professor of economics at Britain's University of Warwick.

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