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Yellen Imitates Greenspan in Reversal of Mid-1990s Rookie Role

  • High-pressure economy back then saw joblessness below 4%
  • Yellen seen probing to determine how low unemployment can fall
Janet Yellen.

Janet Yellen.

Photographer: Andrew Harrer/Bloomberg

When Janet Yellen was a rookie policy maker in September 1996, she and fellow Federal Reserve Governor Laurence Meyer visited Alan Greenspan’s office to make a pitch for higher interest rates. With unemployment near 5 percent, they were worried about inflation kicking up if joblessness dropped much lower.

Then Fed Chairman Greenspan listened to their concerns, but left rates unchanged until the following year. Unemployment eventually fell to a 30-year low of 3.8 percent in 2000 and inflation never really took off.