Senate Banking Committee Turns Spotlight on Yellen Confirmation Hearing – NMP Skip to main content

Senate Banking Committee Turns Spotlight on Yellen Confirmation Hearing

Nov 14, 2013

Fed Chair-to-be Janet Yellen met with members of the Senate Banking Committee Thursday during her confirmation hearing. Among those in attendance included Sens. Charles Schumer (D-NY), Elizabeth Warren (D-MA), Mike Crapo (R-ID) and Tim Johnson (D-SD). Yellen faced a slew of questions regarding the economy, as well as the recovery. Marketwatch provided a liveblog of the event, and some aspects will be highlighted below: "The Federal Reserve is using its monetary policy tools to promote a more robust recovery. A strong recovery will ultimately enable the Fed to reduce its monetary accommodation and reliance on unconventional policy tools such as asset purchases. I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy," Yellen said during her opening remarks. In response to a question regarding the potential “infinity” of quantitative easing (QE), Yellen stated, “I believe that this program cannot continue forever.” Yellen added, “It’s important not to remove support, especially when the recovery is fragile and the tools available to monetary policy, should the economy falter, are limited given that short-term interest rates are at zero.” The prediction for the entire Yellen hearing was that she would defer to the latest in Fed policy, which is essentially what she did. A surprising aspect of Yellen’s discourse during the hearing included her discussing using monetary policy to combat “asset bubbles.” This is a concept that Alan Greenspan was staunchly against and Ben Bernanke isn’t a huge fan of either, however; Yellen being into the idea is a drastic departure. “I consider it imperative that we do what we can to promote a very strong recovery,” she said. Unsurprisingly, Yellen voiced her support of the Fed’s decision regarding the big banks. This shouldn’t surprise many, however; it doesn’t do much to sway her popularity in terms of targeting those big banks. As reported previously, Yellen was responsible for a series of Clinton-era deregulation that has since become wildly unpopular. Yellen also managed to dodge a variety of questions, such as those posed by Sen. Sherrod Brown (D-OH) regarding the big banks and their obvious ducking of legality. Even during the hearing’s big moment – the potential showdown between Senator Warren and Yellen, there wasn’t much in terms of fireworks. Warren simply stated that stricter regulation would eliminate the need for QE, but didn’t press Yellen to go further into the discussion. Overall, the hearing wasn’t particularly exciting other than Yellen’s Matrix-like dodging of Brown’s verbal bullets, there weren’t too many highlights. The hearing was sealed with Schumer praising Yellen’s Brooklyn roots, stating “Your Brooklyn wisdom shines through.” Whether that “Brooklyn wisdom” will result in proper Fed oversight is anyone’s guess.
About the author
Published
Nov 14, 2013
MISMO Updates Business Glossary To Support AI, eMortgages

New definitions covering eHELOCs, remote online notarization, valuation modernization, and compliance initiatives aim to improve consistency

Underwriters Don’t Slow Down Loans. They Eliminate Uncertainty.

ndustry’s biggest bottleneck is not underwriting itself — it is the uncertainty that reaches underwriting too late in the process. When validation happens upstream, speed follows naturally.

MISMO Launches AI Governance Framework For Mortgage Lenders

New FRAME toolkit gives lenders, servicers, and technology providers a roadmap for managing AI risk while supporting innovation

CFPB Tells Lenders Immigration Status Can Factor Into ATR Analysis

CFPB frames immigration status as a potential ability-to-repay factor when future U.S.-based income is at risk

UAD 3.6 Deadline Nears; First American Earns Verification

First American's ACI Sky Workbench gains verification ahead of the Nov. 2 implementation date for the GSEs' updated appraisal reporting requirements

MISMO Introduces New Loan Boarding Standard

Wrapper Files support standardized data transfers between origination and servicing systems, with potential savings of $60 to $160 per loan