Fed’s Yellen Seen as Likely Bernanke Successor, ISI Survey SaysJeff Kearns
Federal Reserve Chairman Ben S. Bernanke probably will be succeeded by Vice Chairman Janet Yellen when his term ends Jan. 31, according to a survey last week by International Strategy & Investment Group.
Sixty-five percent of those polled at the organization’s conference last week said Yellen, 66, is most likely to be nominated for the top job, according to a report today by Roberto Perli, a Washington-based managing director at the investment research firm and a former economist for the Fed’s Division of Monetary Affairs. Sixteen percent of the fund managers surveyed said Bernanke, 59, probably will serve a third four-year term.
Bernanke said at a March 20 press conference he’s “spoken to the president a bit” about his future and that he feels no personal responsibility to keep the post and lead the winding down of the central bank’s unprecedented bond buying. The Fed said last month it will maintain $85 billion in monthly purchases until the job-market outlook improves substantially.
“We agree with the general consensus that Yellen is probably the front runner, but we think her odds might not be as high as many investors seem to believe,” Perli wrote in a note to clients. “In general, we would expect the Fed to continue down the policy path that was traced in recent years.”
Bernanke “could well be renominated,” Perli wrote. Former Treasury secretaries Timothy F. Geithner and Larry Summers “have good chances” of being nominated and “strong ties to the administration,” Perli wrote. In the survey, 5 percent saw Summers, a former director of the National Economic Council, as the most likely next Fed chief while 3 percent named Geithner.
Also at 3 percent in the survey were Federal Reserve Bank of New York President William C. Dudley and Roger Ferguson, a former Fed vice chairman and now chief executive officer of New York-based TIAA-CREF, which oversees $502 billion in assets for 3.7 million retirement clients. Two percent cited Donald Kohn, the Fed’s vice chairman from 2006 to 2010 and now a senior fellow at the Brookings Institution in Washington.
Amy Brundage, a White House spokeswoman, declined to comment on the survey’s findings.
Yellen became vice chairman of the Board of Governors in 2010. She also was a governor from 1994 to 1997 and served as president of the San Francisco Fed from 2004 to 2010.
Bernanke also said in his March 20 news conference that he doesn’t see himself as the only person qualified to lead the U.S. central bank in the years ahead.
Bernanke took over as Fed chief in 2006 after being appointed by President George W. Bush, a Republican. He started a second term in 2010 after being re-appointed by Obama, a Democrat. Bernanke also served as Fed Board governor from 2002 to 2005, when he left to take the position as chairman of President Bush’s Council of Economic Advisers.
“I don’t think the administration has made up its mind and I don’t think Bernanke has made up his mind so it’s still too early to talk about this, but among clients it’s an important topic,” Perli said today in an interview. Yellen “is not a sure thing. There are others that might make legitimate Fed chairmen and shouldn’t be forgotten.”