COLLEGE PARK, Md. - Janet Yellen, the nominee to chair the Federal Reserve, may be new to you. But she is no stranger to students in the University of Maryland’s Robert H. Smith School of Business.
For the last few years, a group of Smith undergrads have met Yellen through the Banking and Private Wealth Management Fellows Program. The program, led by Tyser Teaching Fellow Elinda Kiss, has taken students to meet with senior policy leaders at the Federal Deposit Insurance Corporation and Federal Reserve buildings in Washington, D.C.
Kiss said interactions with Yellen – as vice chair of the Federal Reserve’s board of governors -- have taken place in the Federal Reserve board room, where the Federal Open Market Committee (FOMC) meets to determine monetary policy. “The students have found her engaging and responded that they have learned much through those meetings.”
The most recent visit with Yellen occurred in April 2013.
Then-finance senior Wendy Chen, who graduated in May, said “(Yellen) helped me see how some of the concepts we learned in class are applied to the FOMC meetings, such as setting the targeted federal funds rate and monitoring the balance sheet of the Fed.”
Chen’s classmate, Smith finance and accounting major Pierce Kugler, said Yellen “gave us plenty of time to ask her questions regarding the Fed and her opinion regarding the crises in Europe. I enjoyed hearing an expert’s point of view on current financial topics, and the tools the Fed uses to manage the economy. “
Yellen, pending Senate confirmation, would be the first woman to head the American central bank. But gender aside, “she was “most qualified among the potential successors” speculated on by the press, said Kiss. “She has the most Federal Reserve experience… She warned about the excesses in the housing market that led to the financial crisis.”
“The timing of her Fed chair nomination may send a signal of policy stability to financial markets, where investors are growing increasingly nervous over the partial shutdown and what they perceive as the much bigger threat of a default on Treasury debt if Congress does not raise the borrowing limit,” Kiss added.
Yellen’s credibility is further reflected in her past as a professor of business and economics, Kiss said. “She has written on a variety of macroeconomic issues, while specializing on the causes, mechanisms and implications of unemployment. This background has well served the Federal Reserve dual mandate to maximize employment and stabilize prices.”
David Kass: Yellen Could Offset Fiscal Tightening
Kiss’ Tyser Teaching Fellow colleague David Kass is well familiar with Yellen as an academic. He recently blogged: “I was a student of Janet Yellen in a doctoral course on macroeconomics at Harvard during the spring 1973 semester. This was Yellen’s first year teaching at Harvard, and my first year as a doctoral student. I have stayed in touch with her over the years and have closely followed her career.”
Kass said Yellen, if confirmed, would do a “superb” job. “She is highly regarded by the economics profession,” he said. “Her outstanding track record during her many years on the Board of Governors, including currently serving as Vice Chairman, as well as having been President of the San Francisco Fed, uniquely qualifies her for this position.”
Kass added that Yellen would “likely continue the Federal Reserve's accommodative monetary policy, which should help offset the anticipated tightening of fiscal policy that is likely to result from forthcoming negotiations over the budget.”
Related story: Smith Experts Available to Comment on Yellen Nomination
PHOTO: Janet Yellen (front, left) and Elinda Kiss (front, right) pose with Smith students in April 2013.