Courtesy of Pam Martens.
Janet Yellen, Fed Chair Nominee
According to wire services, today President Obama will nominate Janet Yellen, current Vice Chair of the Federal Reserve and former President of the San Francisco Fed, to be the next Chair of the Federal Reserve Board of Governors.
With the nomination, the simmering controversy over the President’s tortured reasoning to show a preference for Larry Summers for the post will likely be sidelined by a rapid shift to scrutinize every word Yellen has ever stated, written or testified.
In that vein, Wall Street On Parade thought it would be interesting to see what Janet Yellen saw through the lens of the San Francisco Fed President one year before the Wall Street Crash of 2008. We have printed below, in its entirety, the speech Yellen delivered on September 10, 2007 to the National Association for Business Economics in San Francisco.
Titled Recent Financial Developments and the U.S. Economic Outlook, one paragraph commends Yellen’s grasp of the potential dangers ahead:
“To sum up the story on the outlook for aggregate demand, I see significant downward pressure based on recent data indicating further weakening in the housing sector and the tightening of financial markets. As I have indicated, a big issue is whether developments in the relatively small housing sector will spread to the large consumption sector, perhaps through declines in house prices. Should the decline in house prices occur in the context of rising unemployment, the risks could be significant.”
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